( CNN ) -- One can hardly read the news these days without learning that yet another American corporation has announced plans to invert , which is corporate-speak for restructuring as a foreign company to avoid U.S. taxes . It 's a trend that has increased exponentially over the past decade with barely a peep from Congress . Now that corporate giants such as Pfizer , Walgreen , Medtronic and Mylan have made bids to invert by merging with foreign companies and will be eligible to claim their headquarters are offshore to avoid U.S. taxes , Congress may finally act . These large corporations have publicly asserted they are moving their headquarters , but they really wo n't change the way they do business . Medtronic , for example , is buying an Ireland-based company . If the merger goes through , the company has said it will maintain `` operational headquarters '' in Minneapolis , where the company is currently based . In other words , not much will change except the company will claim to be foreign . ( Medtronic officials say the move is not about avoiding taxes and that the firm will still face substantial taxes ; the firm does have the right to cancel the deal if Congress changes the law in a way that removes the tax benefits of inversion . ) Walgreen , the nation 's largest drug retailer , has said it is considering moving its headquarters to Switzerland . Inversions are just another ploy that corporations use to reduce or eliminate their U.S. tax bills . According to the Congressional Research Service , legislation to limit corporate inversions could provide an additional $ 19.5 billion in revenue over 10 years . Even among corporations that are n't pursing inversions , shifting profits offshore to avoid U.S. taxes is a huge problem . For example , American corporations reported to the IRS that subsidiaries in Bermuda and the Cayman Islands collectively earned profits equal to 16 times the gross domestic product of those countries , according to recent data . It 's clearly impossible for companies to earn profits in a country that are exponentially larger than that country 's entire economy , further proving companies are using accounting gimmicks to avoid U.S. taxes . American corporations engage in these tricks because they can defer paying U.S. taxes on alleged offshore earnings until they officially bring those profits to the United States , which may never happen . Corporations get a permanent break when they invert because the United States will not tax profits earned outside its borders . Corporate inversions are often followed by earnings stripping , a maneuver that artificially shifts profits into lower-tax or zero-tax countries . A recent exposÃ© explains how the highly profitable manufacturer Ingersoll Rand suddenly began reporting U.S. losses or very small profits each year after inverting to become a Bermuda corporation in 2001 . This did not reflect any actual loss of U.S. customers or business . Rather , the corporation accomplished this by loaning $ 3 billion to its U.S. subsidiary , which then deducted the interest payments on the debt to effectively wipe out its U.S. income for tax purposes . Defenders of corporate inversions often argue the United States ' 35 % statutory corporate tax rate is too high compared to that of other nations and therefore puts companies at a competitive disadvantage , but most U.S. companies pay nowhere near that rate . Defenders also claim profits earned in the United States will always be taxed here . But the earnings stripping practiced by Ingersoll Rand and other inverted companies suggests this is not true . The ultimate goal of much multinational tax planning is making profits appear to be earned in countries with a zero or low tax rate . Reducing the nation 's corporate tax rate can not address the fact that many corporations are employing various means to avoid U.S. taxes altogether . Companies that have recently sought inversions continue to benefit vastly from public investments . The drugs and devices made by Pfizer and Medtronic , which are often sold by Walgreen , would have far fewer buyers if not for Medicaid , Medicare and other federal health programs . They would not exist without federal investments in research and education and in the infrastructure that makes commerce possible . Taxpayers should be outraged that these companies have no qualms about benefiting immensely from the U.S. economic system without contributing their fair share . But Congress can easily fix this by moving forward with a White House proposal to bar corporations that are obviously American from pretending to be foreign . The plan would sensibly treat newly merged companies as American if they are majority owned by shareholders of the original American company , or if they are managed and controlled inside the United States and have substantial business here . There 's much more to be done to reform America 's tax code , but we ca n't afford to wait for lawmakers to settle how to approach that challenge . If Congress waits too long , there wo n't be much of a corporate tax left to reform .
U.S. corporations , with foreign capital , move their headquarters . McIntyre : Such ` ` inversions '' enable corporations to greatly reduce their U.S. corporate tax bill . He says government can lose millions of annual revenue from such maneuvers . McIntyre : Congress should consider administration proposal to bar inversions .