This hurts. A lot.

Johnson Controls Inc (JCI.N), a U.S. maker of car batteries and heating and ventilation equipment, agreed to acquire Ireland-based peer Tyco International Plc (TYC.N) in a $16.5 billion deal that will lower its tax bill, the companies said on Monday.

By moving its headquarters to Cork, Ireland, Johnson Controls would become the latest major U.S. company to carry out a so-called tax-inversion after drug giant Pfizer Inc (PFE.N) structured such a deal with Irish peer Allergan Plc (AGN.N) last November.

While the tax benefits are not as profound as is the case of Pfizer’s deal with Allergan, the news was enough to stir controversy among politicians in a U.S. presidential election year.

[…]

The deal will create savings of at least $500 million in the first three years, the companies said. They expect to save an additional $150 million a year through tax synergies.

I’ll ignore the statist reactions from the politicians in the article for now. Johnson Controls is (was) Wisconsin’s largest publicly-traded company and they are making this decision to save tax money. It is a perfectly rational business decision in the interests of Johnson Controls’ owners. While the move doesn’t have an immediate impact on Wisconsin since they are leaving their operations based in the state, long term it could have a dramatic impact.

Herein you see the stupidity of this tax policy. By having such a high corporate tax rate, liberals think that it means that they will collect more taxes. In reality, what it does it cost justify businesses doing things like inversions in order to minimize their tax exposure. So in this case, instead of America receiving the lesser tax revenue that would be generated by a lower corporate tax rate, they will receive nothing. Nada. Zero.

The United States’ excessively high corporate tax rate has just cost us another great American company… now a great Irish company.