As was widely reported a few months ago, Burger King is expected to complete a corporate inversion by purchasing Canadian donut company Tim Horton.
Spinning both companies into subsidiaries of a new, multinational fast-food company headquartered in Canada. New numbers released by tax watchdog Americans for Tax Fairness showed just how much Burger King will be saving after this move.
According to the report, the chain is already using aggressive tax planning to keep its bills as low as possible. As a result, its worldwide tax rate is one of the lowest of any U.S. fast food company at 27.5 percent in 2013. By structuring its international activities around low tax countries and loading costs onto U.S. operations, for example, the company is able to minimize its taxable income in America.
One example of the way that many companies do this is by moving the ownership of brands and logos to a subsidiary in a low tax region and then charging exorbitant rates to “arm’s length” subsidiaries in higher tax regions. This makes it appear that high tax subsidiaries are making little profit while low tax subsidiaries are making a lot.
The report looked into ways that Burger King could use its new status as a Canadian resident to avoid paying what would otherwise be U.S. taxes. It found that the company could avoid paying taxes on its current sum of $499 million in offshore profits – otherwise taxable under the U.S. “worldwide” tax scheme – to save $117. On future foreign earnings, this same change would save the company an estimated $275 million between 2015 and 2018. It also found that the top three holders of Burger King stock could use the unique structure of this deal to save on U.S. capital gains tax. The amount saved could be anywhere between $10 million and $820 million.
New Jersey’s Revised UHAC Regulations: What Residential Developers Need to Know About Affordable Housing Commitments
New Jersey residential developers with affordable housing obligations should carefully review their existing approvals, development agreements, and proposed deed restrictions in light of the State’s revised UHAC regulations (Uniform Housing Affordability Controls). The regulations, which took effect on November 6, 2025, significantly change the administration and physical requirements for affordable housing units. For developers with […]
“No Comment” Culture: Why Silence Is Often the Riskiest Legal Strategy
A “no comment” response is sometimes the right call when a legal problem arises. As a blanket policy, however, it lets allegations go unanswered, deadlines pass, evidence disappear, and manageable disputes grow into expensive litigation. The businesses that fare best are usually the ones that say little publicly while acting decisively behind the scenes. When […]
Utility-Scale Battery Storage Projects: A Legal Roadmap for Developers, Property Owners and Other Stakeholders
Utility-scale battery energy storage systems (BESS) are becoming an increasingly important component of the electric grid throughout New Jersey, New York, and Pennsylvania. As renewable generation expands, electricity demand increases and grid operators seek greater flexibility, battery storage can help balance supply and demand while providing additional capacity and reliability. For developers, battery storage presents […]
Navigating Disputes: Hire a Partnership Dispute Lawyer
A falling out between partners can be disastrous for any business. In many cases, the partnership will not survive. If you are in an unworkable situation with your partners, it may be time to consult a partnership dispute lawyer experienced in handling partnership breakups and dissolutions before the situation deteriorates any further. It is easy […]
Section 363 Sales in Bankruptcy: What Businesses, Lenders, and Buyers Need to Know
When a company enters Chapter 11 bankruptcy, many assume the process will culminate in a lengthy reorganization plan. However, distressed businesses are increasingly being sold through a different mechanism — a sale under Section 363 of the United States Bankruptcy Code. A Section 363 sale allows a company, as a debtor-in-possession in bankruptcy, to sell […]
Zoning Laws Explained: What You Need to Know Before Buying Property
Before buying property, it is critical to determine whether local zoning laws may affect your plans. If you plan to redevelop the property, you will want to confirm that local zoning regulations permit development as intended. If acquiring property that is already developed, you must verify that the use is permitted in the underlying zoning […]
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!
