Abdul At Large
Economic Patriotism? Oh Please!
Although I gave up most fast food 25 pounds and seven waist inches ago, I couldn’t help but pay attention to the headline that Burger King is looking at acquiring Tim Hortons thus becoming the third largest fast food chain in the world.
In case you aren’t familiar with Tim Hortons, they are a big breakfast place out of Canada and are known for their doughnuts.
Now while Burger King says the reason for this is simple expansion, there is a another narrative that the company is doing this to relocate its headquarters to Canada and avoid the U.S. high corporate tax rate. This has folks accusing BK of not being a good corporate citizen and engaging in “economic patriotism”. Some short-sighted individuals are even demanding a boycott.
First, a corporation has a duty to its shareholders. And absent anything that compromises national security, it is free to do whatever it wants within the boundaries of the law.
Second, boycotting a local fast food place won’t hurt the corporation, but it will hurt the local people in the community who work there because it is a franchise. Which means it’s likely owned by a local business person and they pay a fee to the corporation to use their name and sell their products.
Third, and most importantly, to paraphrase Malcolm X, tax avoidance is as American as apple pie. Note, I said avoidance which is using the tax code to minimize your tax liability, not tax evasion which is not to pay taxes; that’s illegal. Anyone who is in business is always looking for new deductions, tax credits, losses, you name it to lower their tax burden. Why should anyone get upset when Burger King does it?
BK is looking for a more favorable tax climate. One of the ways Indiana attracts businesses is with its lower taxes and less burdensome regulatory scheme. If you want to get mad at someone get mad at the people who created the high tax rates in the first place. I can assure they’re not making a Whopper with cheese, onion rings and chocolate shake.