What happens when you raise taxes on businesses? They leave:
Last week, the donut chain Tim Hortons, which operates on both sides of the border but is incorporated in the state of Delaware, announced that it was reorganizing itself as a Canadian corporation to take advantage of Canadian tax rates.
As Red State points out,
Let’s just review a few facts.
o Tim Horton’s is mostly a Canadian-based operation (bit of an icon up there, particularly in Ontario); they may own some other brands, but I’m not sure and that might have changed.
o Canada’s corporate tax rate (now 21%) is lower than the U.S. rate (35%) – Prime Minister Harper, sensing an opportunity (particularly given the increased idiocy in Washington), has talked about reducing it further.
o Any profits earned in Canada but “repatriated” (sic?) to the U.S face that nutty double-taxation game that I’ve written about multiple times; Canada (like the rest of the world) doesn’t do double taxation.
So this just makes sense from a business point of view.
Get used to this news; we’ll be seeing a lot of them in the future.
Speaking of taxes, via Ed,