Throughout the past several weeks, Pfizer’s attempt to acquire AstraZeneca has garnered significant congressional and media attention. Pfizer, a U.S. multinational corporation, made a bid for AstraZeneca in an effort to move its tax domicile to the United Kingdom, which has a corporate tax rate of 21 percent compared to the U.S. corporate tax rate of 35 percent. More than 20 U.S. companies have pursued similar inversion tactics by merging with foreign companies in lower-tax jurisdictions throughout the past two years. With the number of members growing every day to put an end to this practice, U.S. multinational corporations must actively engage Congress and the Obama administration to consider long-term solutions in the context of comprehensive tax reform as merger activity continues in the months and years ahead.

Under current law, U.S. companies that reincorporate overseas must ensure that at least 20 percent of its stock is owned by its foreign counterpart. Recently, Sen. Ron Wyden (D-OR), chairman of the Finance Committee, proposed raising that figure to 50 percent effective May 8, 2014. He plans to address inversion in the context of a comprehensive tax reform proposal, which he hopes to unveil within the next year.