WASHINGTON, Sept 18 (Reuters) - U.S. companies that shifted their tax domiciles abroad, if only on paper, between 1994 and 2014 saved millions of dollars in taxes worldwide in the year immediately after doing such "inversion" deals, a U.S. study said on Monday.
A wave of these tax-driven transactions swept through corporate America from 2011-2014. They largely ended in 2015 after a regulatory crackdown by the administration of former President Barack Obama . Previous waves had occurred in 1996-2002 and 2007-2009.
The Congressional Budget Office, a nonpartisan fiscal analysis arm of the U.S. Congress, said profitable companies in the most recent wave reduced their worldwide tax expenses by $45 million on average in the year after doing their inversions. (bit.ly/2xc03Pn)
"CBO projects that the U.S. corporate income tax base will be reduced because of further inversion activity and the expansion of strategies to move profits to lower-tax jurisdictions," the CBO said in its study.
It said U.S. corporate tax revenues would shrink by 2.5 percent by 2027 "if tax-minimization strategies were effectively unchanged from those used in 2016."
Recent inversions included medical technology group Medtronic Plc's move to Ireland, and drugmaker Mylan NV's move to the Netherlands, both completed in 2014.
Mylan's operational headquarters is still in Pennsylvania, while Medtronic's is still in Minnesota, but both companies no longer are treated as U.S.-based companies for tax purposes.
Editing by Kevin Drawbaugh and Lisa Shumaker