WASHINGTON, June 17 U.S. medical device maker
Medtronic's plan to buy rival Covidien and move its base to
Ireland is a sign that something is wrong with the U.S. tax
system, a top Obama administration official said on Tuesday.
The planned $42.9 billion acquisition is the latest
so-called inversion deal to stir controversy in Washington.
Under these transactions, a company buys a foreign firm and
reincorporates in another country to take advantage of lower tax
Deputy Treasury Secretary Sarah Bloom Raskin said the
Medtronic deal should put pressure on Congress and the
administration to overhaul tax laws.
"This is a signal that some kind of business tax reform
should be taken quite seriously," she told a business forum.
"Something is probably wrong with our tax system."
The administration and many lawmakers support reducing the
top U.S. corporate tax rate. But reform efforts in both the
Republican-controlled House of Representatives and the
Democrat-controlled Senate stalled this year amid deep
disagreement over tax and spending priorities.
(Reporting by Jason Lange; Editing by Ken Wills)