The Democratic Party’s field of presidential candidates is united in opposition to the massive merger between pharmaceutical giant Pfizer and Allergan, which would also include a controversial maneuver known as a tax inversion to reduce the company’s U.S. tax burden.
And they’re finding an unlikely ally in GOP pack-leader Donald Trump.
Democratic front-runner Hillary Clinton has taken some knocks from Republicans and the pro-Bernie Sanders left for alleged connections to Pfizer, but said Monday she opposes the merger. “This proposed merger, and so-called ‘inversions’ by other companies, will leave U.S. taxpayers holding the bag,” she said in a statement. “As President, I will fight to reform our tax system to reward growth, innovation, and job creation here in the United States. We cannot delay in cracking down on inversions that erode our tax base.”
Clinton went on to say that she would soon be rolling out specific plans to prevent inversions and to close other loopholes in the tax code so firms can’t “game the international tax system.” She added that she wants Congress to act immediately to make sure that large corporations pay their “fair share” and called on regulators to “look hard at stronger actions they can take.”
The U.S. has in recent years seen a growth in the number of tax inversions, in which an American company buys a foreign one and officially moves abroad to take advantage of a foreign country’s lower tax rate, even while leaving its headquarters and operations back in the U.S.
Burger King and Fruit of the Loom are some of the better known brands to legally move abroad, but pharmaceutical firms have been among the most aggressive in exploiting the move.
Sanders said the Pfizer-Allergan deal would be “disaster” and called on the Obama administration to stop the merger, which would create the largest drug-maker in the world. “The Pfizer-Allergan merger would be a disaster for American consumers who already pay the highest prices in the world for prescription drugs,” Sanders said in a statement.
“The Obama administration has the authority to stop this merger, and it should exercise that authority. Congress also must pass real tax reform that demands that profitable corporations pay their fair share of taxes,” he added.
Challenger Martin O’Malley also announced opposition to the deal and tried to earn points for fighting a similar deal as the governor of Maryland. “Leadership is about actions, not just words, and leading with our principles. I oppose the Pfizer merger now, just as I opposed the last Pfizer merger as Governor of Maryland, because it would have cost Maryland jobs and sent corporate taxes abroad,” he said in a statement.
It’s a similar line to the one the White House has taken. White House Press Secretary Josh Earnest said Monday that the Treasury Department has tried to crack down on inversions, and managed to make them somewhat more difficult, but said Congress needs to act to make more sweeping changes.
Less expected is that they have an ally in Trump. “The fact that Pfizer is leaving our country with a tremendous loss of jobs is disgusting,” Trump said in a statement to Business Insider.
Other Republicans haven’t spoken out about the deal. In the past, however, they have tended to cite inversions as evidence of the need to reduce the corporate tax rate, not as an example of corporate greed.
“We can rail all we want about how unpatriotic it is and how angry we are that Pfizer is selling to another company and they’re going to move outside of America,” Florida Sen. Rubio told CNBC last month. “They have a legal obligation to their shareholders to maximize profits, as long as they can do so legally.”