WASHINGTON: The treasurer of US Company that is projecting a global tax rate of less than 3 percent this year said the country’s tax system makes it difficult to compete in overseas markets.
Anthony Smith of Thermo Fisher Scientific Inc. told the Senate Finance Committee that the US needs to lower the 35 percent corporate tax rate and make it easier for US companies to bring profits home.
Thermo Fisher, which makes laboratory equipment, reported a 9.2 percent tax rate for 2014 and hasn’t reported a tax rate above 12 percent since 2008, according to securities filings.
Still, he said, the potential for owing taxes upon repatriation means that having a U.S. headquarters can be a disadvantage in competing with companies around the world.
“Thermo Fisher has been outbid several times in the competition for strategic acquisitions,” Smith said.
For its own planning and for investors, Thermo Fisher doesn’t use the accounting definition of tax rate, which includes both current and deferred taxes. Instead, he said, the company looks more at the taxes it pays in cash each year.
By that measure, he said, Thermo Fisher pays about 30 percent in the U.S. and 15 percent to 20 percent outside the country, with its income about evenly divided between domestic and foreign sources.
