Pfizer, Merck, J & J, others see the expansion of the tax gap checked
The Johnson & Johnson logo was displayed on a monitor.
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Two democratic legislators pushed five of the country's largest pharmaceutical companies on Tuesday to their low tax invoices and whether they support the expansion of massive tax cuts for the industry in the GOP reconciliation of reconciliation.
Senator Elizabeth Warren, D-Mass., And Rep. Jan Schakowsky, D-il., Before PfizerPresent MerchantPresent Johnson & Johnson, Abbvie And Amgen A little to pay only a few to no federal taxes for profit taxes until 2024 and years, although it generates tens of billions of dollars from their medication annually.
In separate letters to every company on Tuesday, the legislators claim that the pharmaceutical companies have all avoided paying US tax invoices by moving their profits to offshore subsidiaries in jurisdiction with much lower tax rates such as Ireland and Bermuda. This practice was made possible by providing President Donald Trump's tax cuts and jobs in 2017, which aimed to contain corporate tax avoidance, but instead created new incentives for US multinational companies to move profits and operations overseas.
In the letters, Warren and Schakowsky said that practice shows: “Only one of the possibilities of how our tax code was distorted in favor of wealthy pharmaceutical companies, so that they benefit from the Americans and calculate the highest drug prices in the world without paying their fair share of taxes.”
They urged drug makers as to whether the thousands of dollars, which they had to maintain for the lobbying for the congress for the maintenance of these tax gaps in Trump's “One Big Beautiful Bill Act”, which republicans passed at the end of May. In the fourth quarter of 2024, for example, J & J used more than $ 150,000 US dollars for international tax issues in the fourth quarter of 2024 alone, according to the letter to the company in which data from OpenSecrets was compiled.
If the currently written multitrillion dollar tax and expenditure package is issued as written, the Tax Act from Trump would be permanent in 2017. The current iteration also contains historical Expenses to programs for low-income Americans, including Medicaid Health Insurance.
The draft law is now in the Senate, where the Republicans have been promoted many of the provisions that have been promoted by Republicans of the Hard Home, who attempted, falling, falling out the expenditure with tax cuts. However, every democratic advance of eliminating the offshore tax gap would be a hard struggle because the Republicans have a majority in the upper chamber.
Nevertheless, Democrats tried to build public opposition to parts of the legislation, while the GOP is trying to compensate for competing party interests to say goodbye. Both parties have been targeting pharmaceutical companies for years.
“It would be a blow to the congress to expand tax gaps for large pharmaceutical companies, make the billions of profits and overload the Americans,” Warren told CNBC. “These companies must be held accountable to prioritize their profits towards people.
Senator Elizabeth Warren, D-Mass.
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In the letters to drug makers, the analysis of the Council for external relationships in March -an independent, impartial thought factory -cited that the reform of the offshore tax gap over 10 years would bring in at least 100 billion US dollars.
The letters also contain questions about the role of any company in lobbying for an extension of the tax benefits and the appreciated tax liabilities of the federal government. The legislators asked every drug maker to respond until July 1st.
In a statement, a J & J spokesman said that the company was looking forward to clarifying its “important US tax contributions and cooperative to Senator Warren and representative of Schakowsky's letter”.
Spokesman for Pfizer, Merck, J & J, Abbvie and Amgen did not immediately answer the letters to inquiries about comments.
It is not the first time that the legislator has examined pharmaceutical companies for their tax practices.
In a March report, Pfizer was accused of what Democratic Senator Ron Wyden, D-ORE described “the largest taxable program” in the history of the pharmaceutical industry. The report accused the company to use a tactics called “Roundriping” to avoid payment of a US income tax for $ 20 billion in domestic medication in 2019.
An investigation by the democratic staff of the Senate Finance Committee showed that Pfizer used the tax gap to transport profits from offshore subsidiaries in tax havens such as Ireland and Puerto Rico, although they were sold to US patients. However, the company said that it has paid 12.8 billion US dollars of US taxes over four years and that documents were submitted to Securities and Exchange Commission.
The letters come on Tuesday when the Trump administration in the USA imposes tariffs on pharmaceuticals in order to do the production of re -enacting. Trump has complained that Ireland has successfully convinced the drug manufacturers to open the production operations there by offering low tax rates.
