Can Lawmakers Work to Stem Tax-Friendly Deals?

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May 13 (Bloomberg) -- Greg Valliere, chief political strategist at Potomac research Group, discusses the chance of political acceptance of Pfizer’s deal to purchase AstraZeneca and how far the Congress and Senate will go in allowing U.S. companies to make deals to protect profits from taxes. He speaks on Bloomberg Television’s “Market Makers.”

And republicans are at loggerheads over everything about what is the chance that congress could act to stop this deal from going forward?

Is an election year, and democrats need issues.

They're itching to take a stance on this.

Chances are slim we could get anything through both houses, but if there are more deals and in addition to this pfizer deal, if we have three or four more announced in the next few weeks, then i think there is a decent chance that the senate could pass legislation curbing future so-called inversions.

Once the senate acts, there is a chance of getting something to the house, but it is below 50-50. is there breaking point for the house?

You bet.

An achilles' heel for the republican, who are looking pretty good for this election, i think it has to be the fact that on issues like minimum wage and unemployment benefits, they look weak and they look like they are not defending workers.

If you see more of these deals with companies saying we are leaving the u.s., even the republicans might get nervous and agree to something.

You would have to see a lot more deals.

Why is this part of an issue at all?

Surely they look at some qualities of these tax and version deals and see the same thing, the loss of u.s. corporate tax revenue.

At the core of this entire argument, it is the debate over whether we are going to have fundamental overwhelming tax reform, or do it piecemeal.

A lot of republicans, and quite a few democrats as well are saying let's have a sweeping tax reform bill.

They would like to deal with things like this, and repatriation earnings coming back to the u.s.. they would like to deal with this in one big package, not piecemeal.

When you talk to people in the house about like the ways in the -- and means committee chairman, he says we should do it in one bill.

It is an election year, and i think both parties would disagree on a resolution in favor of mother's day.

But the longer they wait, the greater the chance that more companies will do this kind of tax and version deal, like the one that pfizer has proposed.

Is the argument that the enemy of the good hold any weight?

It is an election year, everything gets thrown out.

Congress could get riled up over this issue.

I would expect them to come sooner rather than later before their is some action.

I think retroactively trying to stop these deals are trying t -- are quite slim.

I think you cannot rule out something this summer if these deals continue.

When they err on the side of a global minimum tax, or a territorial tax system?

Right now they're talking about a deal requiring a pfizer to acquire a much bigger chunk of these companies overseas.

I think there would be a percentage, maybe 50% ownership rule.

The main feature would be the elimination of all of the deduction, and lowering the top rate from 35% among the highest in the world down to 26% or 27%. i do think we would get repatriation.

All of these earnings that are stashed in ireland and elsewhere would come back to the u.s. as part of a sweeping bill.

That will not happen this year, that is a story for 2015 and beyond.

Thank you so much.

This text has been automatically generated. It may not be 100% accurate.

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