Why AbbVie (ABBV) Stock Is Down Today

NEW YORK (TheStreet) -- Shares of AbbVie  (ABBV) fell 1.92% to $57.58 in morning trading Tuesday after the U.S. Treasury Department and the IRS announced a plan to decrease inversion tax benefits.

The plan aims to discourage U.S. companies from moving their headquarters to other countries through mergers with foreign companies in order to take advantage of the benefits and reduce their U.S. taxes. The government structured the revisions to five sections of the tax code to make it more difficult for companies to make the tax inversion deals and to reduce the financial benefits should they do so.

"These first, targeted steps make substantial progress in constraining the creative techniques used to avoid U.S. taxes, both in terms of meaningfully reducing the economic benefits of inversions after the fact, and when possible, stopping them altogether," said Treasury Secretary Jacob J. Lew in a statement. "While comprehensive business tax reform that includes specific anti-inversion provisions is the best way to address the recent surge of inversions, we cannot wait to address this problem."

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Shares of Shire  (SHPG) , which AbbVie agreed to buy for $54 billion in July in a tax inversion deal, also fell 2.06% to $251.01 on Tuesday morning.

 

ABBV Chart ABBV data by YCharts

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