Clinton, Trump tax comments 'a little rich': CEO

Hillary Clinton slams Pfizer-Allergan merger

The CEO of an Irish-based food conglomerate has hit back at the U.S. politicians portraying Pfizer's deal with Allergan as a tax dodge, saying that the issue was more of a "legal" one than a "moral" one.

Asked about the issue following Democratic presidential nominee Hillary Clinton's comments on Monday, Patrick Coveney, the CEO of Greencore, told CNBC that it was up to politicians to determine how countries handle their tax affairs.

"I do find it a little rich to hear politicians....making the kind of points that they are making," he said.

"Because, frankly, it is within the control of the global political system to adjust laws to deliver the outcomes that they want."

Democratic presidential candidate Hillary Clinton speaks during a community forum campaign event at Cornell College in Mt Vernon, Iowa, October 7, 2015.
Scott Morgan | Reuters

Coveney, who heads the world's largest sandwich maker, said that the recent deal between Pfizer and Allergan involved a lot of emotion and conceded that it would be difficult for politicians to adjust laws over a short period of time.

"My own view is that tax is largely a legal matter," he said, arguing that it wasn't a moral issue.

U.S. drug giant Pfizer is looking to acquire Botox maker Allergan for more than $150 billion, creating the world's biggest drug maker. As part of the deal, Pfizer plans to move its tax address from the U.S. to Ireland, by merging with the group.

Democratic presidential candidate Hillary Clinton speaks to guests at the Jefferson-Jackson Dinner on October 24, 2015 in Des Moines, Iowa.
Hillary Clinton slams tax-avoiding pharma mega deal

This would restructure the amount of tax it pays and a similar strategy has been used by several companies over several decades. However, the move has been labeled "disgusting" by Republican front-runner Donald Trump who believes the U.S tax system should be overhauled.

Clinton, meanwhile, accused Pfizer of using legal loopholes to avoid its "fair share" of tax, according to Reuters, adding that the deal "will leave U.S. taxpayers holding the bag."

The U.S. government has been promising a crackdown on these tax inversion deals, yet it appears that major U.S. firms are still being tempted by the savings involved in snapping up smaller foreign rivals and re-domiciling themselves to avoid America's labyrinthine tax system.

Greencore, itself, has been accused of paying an effective tax rate of just 1 percent in Ireland, according to the Irish Times, due to it being U.K.-listed, Irish domiciled and using "deferred tax assets."

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"For five years now, we have had very low levels of marginal tax. The function of that has been pretty straightforward, it's been driven by having a large chunk of capital allowances and unused tax losses in an equivalent business that we purchased," Coveney told CNBC.

"Because of the number of jurisdictions in which we operate, we have tax requirements in all of those and we absolutely have to adhere against that."

He stated that Ireland wouldn't be greeting the news of the Pfizer-Allergan deal with any form of glee. He said that the level of scrutiny that Ireland will now come under as a result of the announcement won't be helpful to foreign direct investment into the country, or for the political engagement between the U.S. and Ireland.

—CNBC's Catherine Boyle contributed to this report.