Senate Finance report says AbbVie shifted profit overseas to cut taxes

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A signal stands exterior a Abbvie facility in Cambridge, Massachusetts, U.S., May 20, 2021. REUTERS/Brian Snyder/File Image

July 7 (Reuters) – Drugmaker AbbVie Inc generates most of its income in the United States, whilst shifting most of its revenue overseas in purchase to stay away from U.S. taxes, an interim report from the Senate Finance Committee mentioned on Thursday.

According to the Democratic workers report, far more than 75% of Illinois-primarily based AbbVie’s revenue were being created in the United States, whilst just 1% of its money was claimed in its house place for tax reasons.

This has been a prolonged expression pattern for the business. In 2018, Reuters laid out how AbbVie claimed its revenue in reduce tax jurisdictions, which was possible in section since the business parked the the vast majority of the patents for its top rated-marketing drug, the rheumatoid arthritis treatment Humira, in tax haven Bermuda.

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The Senate Finance Committee report reported that the gain shifting has resulted in “stunningly very low effective tax premiums” for the drugmaker in recent many years: 8.7% in 2018, 8.6% in 2019 and 11.2% in 2020. The present-day U.S. company tax price is 21%.

The report instructed reforms to the U.S. tax code to treatment the situation, which include rising taxes on certain cash flow earned abroad and fixing loopholes that really encourage offshoring.

AbbVie did not respond to a ask for for comment.

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Reporting by Michael Erman
Editing by Invoice Berkrot

Our Specifications: The Thomson Reuters Have confidence in Principles.

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