If Walgreen wants to save a mountain on taxes by moving to Switzerland, it had better get ready for an avalanche of criticism.
The drugstore giant could save $4 billion in federal taxes over the next five years by reincorporating in Switzerland, according to a report to be released Wednesday.
The artful tax dodge has been advocated by a cadre of shareholders, including billionaire Barry Rosenstein, who this spring shelled out $147 million for a Hamptons beach house, the highest-ever price tag for a private US residence.
But the move could also cause a major public-relations headache for Walgreen, according to the study compiled by Americans for Tax Fairness, a Washington think tank.
That’s because Walgreen gets nearly a quarter of its revenue from US taxpayer-funded Medicare and Medicaid programs, the report calculates — not to mention millions in federally subsidized bonuses enjoyed by top Walgreen execs.
“Many Americans will find it unfair and deeply unpatriotic if the company moves offshore, while continuing to make its money here, leaving the rest of us to pick up the tab for its tax avoidance,” said Frank Clemente, executive director of the think tank.
Lousy deal. And of course part of it is they are leaving Illinois, a grossly mismanaged State with a high tax rate.
Seems to me that a consumer boycott is in order. It won't be any big problem for me to take my business to the other drug stores.
The Feds actually have all kinds of leverage on Walgreens. If you want to play political hardball, don't let Walgreen's service Medicare or Medicaid accounts, which is a huge part of their business. The Feds recently took Tri Care - the military health insurance - out of Walgreens.