The Panama Papers leak have laid bare the secretive practice used by the wealthy to hide their money through the use of offshore tax havens.
Hours after that story broke, the US Treasury Department has come out with tough new rules to discourage stateside companies from engaging in another tax avoidance tactic: corporate inversions. An inversion takes place when a US company buys a smaller, foreign entity and moves its headquarters overseas to lower their US taxes.
Though controversial, the practice is technically legal. One of the deals these new rules might jeopardize is the proposed merger between US big pharma Pfizer and the Ireland-based Allergan.
What are the new Treasury rules? What impact would they have on corporate inversions?
Edward Kleinbard, a professor of law and business at USC, who focuses on domestic and international tax issues. He is also former Chief of Staff of the US Congress’s nonpartisan Joint Committee on Taxation
Kevin G. Hall, chief economics correspondent for the McClatchy Newspapers. He has co-written a piece looking at a few of the American names that have shown up in the so-called Panama Papers