Burger King May Become A Canadian Company (BKW)

Burger King, an iconic American fast food brand, may soon become a Canadian company. According to a statement by the company, Burger King is in talks to purchase Tim Hortons and base the headquarters of the combined company in Canada instead of the United States. The merger with the Canadian doughnut chain would create the one of the largest fast-food businesses in the world with a market value of more than $18 billion. The move would also slash the amount of taxes the company would owe in the United States, even if the same number of sales were made.

A number of American companies have been looking for foreign companies to acquire so they can move their headquarters abroad to countries that have friendlier tax laws. The United States government has publicly denounced these so-called “corporate inversion” mergers that allow American companies to switch national citizenship in order to lower its tax bill while still doing business in the United States. Tax authorities are currently looking for ways to close this loophole in the tax laws to ensure that the revenue made from sales in America generate taxes that will stay in America and go towards improving the lives of American citizens.

The current tax rate for corporations in the United States is officially around 35 percent, although many large companies pay far less than this through a series of accounting tricks and monetary transfers. In comparison, the top tax rate for corporations in Canada is around 15 percent, saving the company a significant amount of money that can go to shareholders and executives of the company. While many suspect that this is the true reason for the potential deal between Burger King and Tim Hortons, Burger King representatives insist that lowering its tax rate is not the main driver for the talks between the companies.

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