Endo to Pay Executive’s $60 Million Tax Bill in Move

http://www.bloomberg.com/news/2014-05-15/endo-to-pay-executive-s-60-million-tax-bill-in-move.html

Endo International Plc, one of a half dozen U.S. drugmakers that recently took Irish addresses to save on taxes, said it plans to spend $60 million to pay personal tax bills incurred by top executives in connection with the switch.

A pretax charge for that amount contributed to the company’s $437 million loss in the quarter ended March 31, Endo said in a regulatory filing last week. The costs stem from a special penalty Congress imposes to discourage executives from reincorporating their companies in tax havens.

Endo, headed by Chief Executive Officer Rajiv de Silva, changed the incorporation of its parent company to low-tax Ireland in February. Since then, the practice of switching legal domiciles, known as “inversion,” has attracted attention in the U.S. Congress after Pfizer Inc. (PFE) announced its plans to buy London-based AstraZeneca Plc and become a British company.

Senator Carl Levin, a Michigan Democrat, yesterday called for a moratorium on the transactions and said he would introduce related legislation this week. Proposals from Levin and other Democrats have little chance of becoming law quickly because Republicans want to address the issue as part of a broader revamp of the tax code.