The U.S. corporate tax rate is among the world's highest, at 39 percent. In a bid to lower their tax bills, more U.S. firms are making merger deals with foreign companies. In principle, moving their legal corporate headquarters out of the U.S. to a country cuts their tax bill.
In the case of Johnson Controls, the new company will operate under Ireland's 12.5 percent tax rate. The companies say the deal is not only for tax reasons: The move is expected to save $150 million dollars every year in other savings. Regardless, some observers say there are more than taxes to consider.
"We always have to balance the question of whether a corporation is supposed to be focused only on the short term return to the shareholder, or whether the corporation has other stakeholders," Isaacson told CNBC.
"The problem is with a 39 percent (U.S.) corporate tax rate and $150 million to be made each year, if you do an inversion, the balance tips and people move jobs overseas", Isaacson added.
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To be fair, with deductions and loopholes, few companies actually pay the full 39 percent tax rate. That said, the list of companies fleeing, or looking to leave, is growing.
In 2014, U.S. medical device manufacturer Medtronic bought Covidien and moved to Ireland. That same year, Miami-based fast food giant Burger King merged with Canada's Tim Hortons and moved the company north of the border.
Meanwhile, a potentially larger deal is still pending. U.S. pharmaceutical giant Pfizer is planning a move to Ireland if its more than $150 billion dollar merger with Allergan clears regulatory muster.
Last Fall, the Treasury Department announced new rules to cut down on inversions, but so far the mergers continue.