Hi, Angel here, your co-host from the MIDJersey Chamber of Commerce Business Hour Sundays at 10 a.m. on 107.7 The Bronc. This week we discussed Walmart plans to acquire Jet.com due to a faltering online presence, the United States being sued after changes in tax inversion laws, lobbyists’ range of influence, as well as Facebook choosing to stem the all-you-can-advertise buffet.
I started the show off by introducing Walmart’s plan to acquire Jet.com. Walmart makes a push to conquer the online retail market by purchasing established businesses. Walmart stands on top of in-store sales but its online presence is still too young. Amazon is its biggest competitor as it makes 100 billion in online sales, while Walmart only makes 14 billion. This is one of a string of online mergers and acquisition deals meant to bolster a company’s existing services. It is much cheaper to buy a company than spend time and money to develop one’s own service or product. If you can’t beat ‘em, buy ‘em.
We then covered a lawsuit against the Federal Government by the U.S Chamber of Commerce and a Texas Businessman for changing the tax code. The lawsuit alleges that the U.S government made changes to the tax code in order to prevent companies from using tax inversions to avoid paying taxes. A tax inversion is a strategy used by companies to lower their tax liabilities; this process involves purchasing a foreign company in order to change the headquarters of the company to a more favorable tax location. The lawsuit states that the changes were not made legally since the changes were not passed through congress instead of rewriting the code on their own. The Internal Revenue Service made the changes and implemented them on April 4th of this year. The new change interrupted the large acquisition of Allergan by Pfizer. The merger would have been one of the biggest in U.S history and would have saved Pfizer billions in taxes due to Ireland’s favorable corporate tax laws. As the lawsuit progresses it will be interesting to see how the courts interpret the IRS’s actions and how this will affect future tax policies.
My co-host, Kim Gordon took on the lobbyists and their impact on regulations. A lobbyist is a person whom is contracted a firm in order to protect their interests by supporting or blocking certain legislation. These people tend to have previous positions in policy making; after they retire from Washington they join a large corporation as a consultant in order to help them avoid unfavorable regulation. This brings up the issue that there is always someone else controlling the policies of a country other than the people voting on them. Companies spend millions of dollars annually in order to convince lawmakers by paying for campaigns and dinners.
Kim ended this week’s MIDJersey Chamber of Commerce Business Hours ended talking about Facebook’s move to lower click bait ads on people’s newsfeed. Facebook makes most of its revenue by allowing ads, but this unfortunately has cluttered everyone’s newsfeed with unnecessary interruptions that take away from the experience. Luckily the social media site has responded to this issue by filtering out the petty ads, and can afford to do so in the bargain, unlike other sites that rely on ads for their revenues. The all-you-can-advertise buffet’s selection just became a lot more selective- and we like it that way.
If you have an opinion on business then you want to tune in every Sunday at 10 a.m. to find out what interesting topics the MIDJersey crew will be discussing next on The MIDJersey Chamber of Commerce Hour Sunday’s at 10 a.m. On 107.7 FM, online at 1077TheBronc.com and via our free Android and iOS apps.