A look at the world's new corporate tax havens

Lesley Stahl explains how U.S. corporations are cutting their tax bills by moving business overseas

CBS All Access
This video is available on CBS All Access
Another Texas company that moved to Zug is Weatherford, a $10 billion oil field services firm. It still has 2,800 workers in Houston. But according to official documents, they are incorporated in Zug, in a small building. But there was no Weatherford on the sign outside.

"Finally found it," Stahl said, searching over a row of mail boxes in the foyer of the building. "Listed in this thing: Weatherford International, here's the mailbox. But we don't know even where to go, because there's no listing for the international headquarters of Weatherford."

So Stahl started knocking on doors.

"We're looking for Weatherford. Are they in this building?" Stahl asked one woman working in an accounting office.

"Yes," she replied. "Just a moment let me check."

Stahl was shown to a conference room they said Weatherford rents for board meetings, but Weatherford's Houston office told us they never go there. So are these big companies pulling a fast one? Apparently not: under both Zug and U.S. tax laws, it's perfectly legal to get the low tax rate even without a real presence in Zug. But Rep. Doggett wants to change that.

"You have a proposed legislation that a company will be taxed not based on where they file some pieces of paper, but where their decision makers and management actually resides and makes decisions," Stahl remarked.

"Let them pay the same way that other Houston-based companies pay. And so if they have their management and control are there, they ought to be paying here in the United States. I think it's fair," Doggett argued.

We found that faced with the mere threat of Doggett's legislation, Transocean and Weatherford both recently packed up their top brass and shipped them to Geneva.

We were told Transocean's top ten executives live in the Geneva area, and work on the top two floors of a Geneva office building - everyone from the CEO to the chief financial officer, to the vice president of taxes.

They wouldn't talk to us on camera, and neither would Weatherford. They also moved their CEO and CFO to Geneva. And so now we're beginning to see a jobs exodus from the U.S. of top management.

"We can't write a law their lawyers can't get around. That's the whole problem here," Doggett explained.

"You're in Congress. Why did Congress write these laws that allowed this to happen?" Stahl asked.

"There's been a lot of arm twisting, a lot of effective lobbying here, and some really smart tax lawyers figuring out how to game the system with one shenanigan after the other," the congressman replied.

"But are they shenanigans or is it the law?" Stahl asked.

"I think it was a shenanigan when some of these companies felt so strongly about America that they renounced their American citizenship and began saluting a foreign flag. They exploited a provision in our tax laws and moved offshore," Doggett said.

Congress tried to put a stop to that with a law passed in 2004, mandating that any company that wanted to move offshore would still have to pay the 35 percent. But because of loopholes in the tax code, companies can substantially lower their taxes by moving chunks of their businesses to their foreign subsidiaries.