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Walgreens Nixes Overseas Move

Walgreens Nixes Overseas Move

Walgreens is keeping its headquarters in Illinois, instead of moving to Europe. It’s a decision about which U.S. Sen. Dick Durbin (D-Ill.) talked to the boss of the company.

“This morning I had a phone conversation with Greg Wasson, the CEO of Walgreens, and I congratulated him on this decision to stay in America and stay in Illinois,” Durbin said this morning at a news conference in the parking lot of a Walgreens store in Chicago.

Walgreens had been considering an inversion, in which they would be bought out by a foreign firm and then be based in another country, avoiding U.S. taxation on profits. Walgreens already owns 45 percent of Alliance Boots, a British drugstore chain based in Switzerland for tax purposes. Walgreens will buy the remaining 55 percent, but keep its corporate headquarters in Deerfield.

Durbin says customers will respond to Walgreens’ decision. “I believe, and he (Wasson) does too, that his loyal customer base for Walgreens will reward this decision. They’re gonna stay with Walgreens. They’re gonna honor the fact that they want to stay in America,” Durbin said.

But Durbin says the tax code must change to make it harder for American companies to establish headquarters out of the country. He says the threshold of foreign ownership allowing this must be raised from 20 percent to 50 percent. He believes this change will have bipartisan support and can be accomplished next year.

Durbin says 23 percent of Walgreens’ revenue comes from Medicare and Medicaid, and more when you include veterans’ benefits and other taxpayer-funded programs.

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