Former U.S. Senators Trent Lott and John Breaux are part of a lobbying effort by companies that want to preserve the option of reducing their corporate taxes by moving their legal addresses overseas.
Nine U.S. companies that have sought cross-border mergers for tax reasons, are considering doing so or are targets of such deals have been pressuring lawmakers since April on legislation to stop the practice, federal disclosure reports show.
They include Medtronic Inc. (MDT), the Minneapolis-based company that is seeking to acquire Dublin-based Covidien Plc. (COV) Medtronic paid Breaux-Lott Leadership Group $200,000 in June to block legislation from moving forward. Breaux, a Democrat, was once a member of the Senate Finance Committee. Lott, a Republican, is a former Senate majority leader.
One company that hasn’t publicly announced an intent to move its address abroad — Kimberly-Clark Corp. (KMB), the Dallas-based maker of Kleenex tissues and Huggies diapers — added opposition to such legislation to its lobbying report. Kimberly-Clark is spinning off a health-care unit.
“There are a lot of reasons why tax reform is stuck in Congress, and one of them is because big companies with vested interests want it to be stuck,” said Adam Rappaport, a senior counsel at Citizens for Responsibility and Ethics in Washington, which flagged the Medtronic lobbying activity.
John Breaux, a Democrat, was once a member of the Senate Finance Committee.
‘Well-Connected Lobbyists’
“Hiring an army of well-connected lobbyists is probably a good investment on their part, regardless of whether it is in the country’s best interest,” he said.
