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Published 13:21, April the 12th, 2009
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Lobbying on Taxes Paid Off for Pfizer, HP, Kansas Study Says

NEW YORK. Pfizer Inc., Hewlett-Packard Co. and other corporations pushing for a one-time tax break on overseas income received a 22,000 percent return on their lobbying expenditures, according to a study by the University of Kansas in Lawrence.

The companies pushed for a temporary tax break to 5.25 percent from 25 percent on overseas profits brought back to the U.S. The money had to be used for specific purposes, including hiring, training and research. New York-based Pfizer brought back $36.9 billion in overseas profits.

The study found that firms saved $220 in U.S. income taxes for every $1 they spent on lobbying for the 2004 measure. It looked at 476 companies that brought back more than $298 billion, including Pfizer and Palo Alto, California-based Hewlett-Packard.

“We should be concerned when a corporation’s most lucrative investment is in lobbying the government for tax benefits,” said Stephen Mazza, associate dean of the university’s law school and one of the study’s authors.

Pfizer and Hewlett-Packard did not immediately respond to requests for comment.

In February, lawmakers rejected a new tax break on overseas profits as part of the $787 billion stimulus package. Senate Democrats said the earlier legislation did not create any new jobs. In fact, Senator Carl Levin, a Michigan Democrat who chairs the Senate Finance Committee’s investigations subcommittee, reported that Pfizer cut 9,000 jobs.

Bloomberg