Burger King Dodging Taxes, Facing Boycott?

BK

On Yahoo! News, we read:

Small, medium or large? The amount of outrage over Burger King’s deal to buy a Canadian donut chain could possibly determine whether the deal goes through — and helps Burger King dodge millions of dollars in U.S. taxes.

Burger King’s (BKW) plan to buy the Tim Hortons (THI) chain now confirmed, following initial leaks — seems like a smart strategic fit that would benefit both companies, even without a tax savings. Horton’s would get a much broader global distribution chain than it can build on its own…

Burger King has a problem, though, because the deal also includes a plan to change the new firm’s nominal headquarters from Miami to Oakville, Ontario, where Hortons is based. That would subject the new company to Canada’s far lower corporate tax rates. Last year Burger King paid $89 million in taxes on $1.1 billion in revenue, according to its annual filing with the U.S. government. Uncle Sam would lose some of that money if the deal goes through.

Federal, state and local tax rates in the United States can reach as high as 40%. In Canada, the maximum is 26.5%. That makes Burger King the latest of several big U.S. companies seeking a “tax inversion” that would allow it to merge with a foreign partner and pay taxes in another country, where rates are lower.

Looks like Burger King wants to have it their way. Not everyone is OK with this.

Activist group MoveOn.org is sponsoring a petition to scuttle the “Whopper Tax Dodge” or else institute a boycott. The petition has more than 1,000 signatures.

MSNCB TV host Joe Scarborough called for a Burger King boycott. Sen. Sherrod Brown (D-OH) did too, saying in a statement, “Burger King’s decision to abandon the United States means consumers should turn to Wendy’s Old Fashioned Hamburgers or White Castle sliders.”

My reaction? I applaud Burger King heartily for the move. I hope they actually go through with it. I don’t eat at BK now, but if they move to Canada, then I might start eating there once a month or so just to show my support. In my opinion, “tax evasion” of the legal sort mentioned here is a heroic deed. Anything that deprives money from the hands of the State is a measure that I applaud heartily. Anything that allows private individuals and companies to keep their own money is a measure that I applaud heartily.

What bugs me most about this whole affair are the negative reactions. All these people are so upset the BK wants to move to Canada for a lower tax rate. They call it “tax evasion”. Instead of being pissed off that BK wants to leave, how about being pissed off that the US government refuses to be competitive with other tax rates offered internationally? We should be fighting for a tax rate as low as Canada’s.

I felt the same sentiment during the Occupy Wall Street protests. I’m glad people realized there are problems in the USA worth protesting, but a lot of the protestors were totally misguided, calling for higher taxes on rich people and corporations and raging against tax loopholes. I say, instead of bitching for more taxes on others, how about demanding lower taxes for ourselves? Instead of demanding an expansion of more government-sponsored thievery and violence against others, how about demanding a rollback of government-sponsored thievery and violence in our own lives? When I read stories about rich folks in the US legally dodging taxes through loopholes and other means, I think to myself: “I need to find a way to do that.” Instead of calling for the closing of loopholes, we should be calling for loopholes to be created for the rest of us. I want loopholes upon loopholes upon loopholes. There should be a way for everyone to legally lower their tax burdens, or even avoid paying entirely. Now that’s a protest movement I could get behind!

Unfortunately, not everyone feels like I do. Somehow, by some perversion of the mind, a lot of people fool themselves into thinking that politicians and bureaucrats can manage our money better than we can.This is because a lot of people in the USA are zealous adherents to the Church of the United States Government, and believe fervently in the messianic character of the State. The infamous “Obama will pay for my gas” video from 2008 sums this up quite nicely.

A lot of people upset about Burger King’s attempts to escape hefty US taxes are probably also the same people who believe in the messianic character of the State, the notion that the State can and should be the provider of food, shelter, employment, healthcare, and education to the baseless masses, and that they have a divine right to seize the goods of private citizens in order to do so. It is a foolish viewpoint. The people who think they will be able to rely on the State to always be there for them are sorely mistaken.

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