Durbin Urges Monsanto to Keep Tax Address in U.S.
Senator calls for Congressional action to close corporate “inversion” loophole
[WASHINGTON, D.C.] – Following news reports that Monsanto is considering acquiring Syngenta AG based in Switzerland, U.S. Senator Dick Durbin (D-IL) today urged the Chairman and CEO, Hugh Grant, to keep its corporate tax headquarters in the U.S. rather than move it overseas, but only on paper, in order to avoid paying U.S. taxes – a process known as “inversion”.
“As you consider acquiring Syngenta AG or any other company, I strongly urge you and the board of directors to maintain Monsanto Company’s headquarters and its tax address in the United States. You and your board must recognize that your company’s continued commitment to America would be good, not only for the country, but also for Monsanto Company’s bottom line,” Durbin wrote.
In January, Durbin joined U.S. Senator Jack Reed (D-RI) and U.S. Representatives Sandy Levin (D-MI) and Lloyd Doggett (D-TX) to reintroduce the Stop Corporate Inversions Act of 2015 would close the corporate inversion loophole and raise nearly $34 billion over ten years. Since 2004, more than 40 U.S. corporations have inverted – many by acquiring a smaller foreign company to avoid Section 7874 of the Internal Revenue Code which Congress enacted to discourage companies moving their tax address to a foreign jurisdiction as part of an acquisition.
“Monsanto Company’s expansion is in large part due to U.S. taxpayer-funded programs and services. Monsanto Company’s numerous products build on the research advancements made possible by taxpayer-funded programs, such as programs at the National Institutes of Health and the National Science Foundation. Monsanto Company’s billions of dollars of profits depend upon a robust U.S. patent protection system provided by U.S. taxpayers and a workforce trained and educated with significant federal, state and local resources,” Durbin continued.
Last month, Durbin joined Reed, Levin, Doggett U.S. Senators Sheldon Whitehouse (D-RI) and Al Franken (D-MN) and U.S. Representative Rosa DeLauro (D-CT) in introducing legislation would ban federal contracts for companies that invert and curb subcontracting to inverted corporations by allowing federal agencies to ban businesses from holding federal contracts if they subcontract with inverted corporations.
Text of today’s letter is below:
Hugh M. Grant
Chairman and Chief Executive Officer
Monsanto Company
800 North Lindbergh Boulevard
St. Louis, MO 63167
Dear Mr. Grant:
Recent reports indicate that Monsanto is considering acquiring Syngenta AG based in Switzerland. When Monsanto Company considered a similar acquisition of Syngenta AG in 2014, it was reported that Monsanto Company had planned to move its tax address to Switzerland as part of the acquisition, known as a corporate tax inversion, to avoid paying U.S. taxes. I urge you and the board of directors to maintain Monsanto Company’s tax address in the United States.
Over its 115-year history, Monsanto Company has grown from a small startup company to a global corporation with more than 21,000 employees, of which half are located in the United States, and profits exceeding $8.5 billion last year alone.
Monsanto Company’s expansion is in large part due to U.S. taxpayer-funded programs and services. Monsanto Company’s numerous products build on the research advancements made possible by taxpayer-funded programs, such as programs at the National Institutes of Health and the National Science Foundation. Monsanto Company’s billions of dollars of profits depend upon a robust U.S. patent protection system provided by U.S. taxpayers and a workforce trained and educated with significant federal, state and local resources. Many of Monsanto Company’s products are regulated by the taxpayer-funded Food and Drug Administration and U.S. Department of Agriculture.
If Monsanto Company decides to invert and move it tax address outside the U.S. to avoid paying U.S. taxes, the tax dollars your company is taking overseas will not support the very programs and people your company relies on to succeed.
As you consider acquiring Syngenta AG or any other company, I strongly urge you and the board of directors to maintain Monsanto Company’s headquarters and its tax address in the United States. You and your board must recognize that your company’s continued commitment to America would be good, not only for the country, but also for Monsanto Company’s bottom line.
Sincerely,
Richard J. Durbin
United States Senator
Cc: Board of Directors
Gregory H. Boyce
David L Chicoine
Janice L. Field
Arthur H. Harper
Laura K. Ipsen
Gwendolyn S. King
Marcos M. Lutz
C. Steven McMillan
Jon R. Moeller
William U. Parfet
George H. Poste
Robert J. Stevens
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