Question

Why is the main objective of these cross border mergers, whether the US firm is the acquirer or the company that is acquired, to change the legal domicile of the merged firm from the standpoint of income taxation .

Short answer

The main objective of US cross border mergers is corporate tax savings by companies, as US corporate taxes rate are the highest.

Step-by-step solution

Basics 

Corporate mergers and takeovers across national borders lead to - shifts of headquarters in other country, or levy of low foreign tax rate for the combined company. It implies lesser tax base for US and lesser corporate tax payment by companies, decreased corporate tax revenue in US.

Explanation 

It is an incentive for companies to do so, based on the reason that US corporate tax rate is highest in the entire world.

Example : Burger King made huge tax savings by taking over a Canadian food chain and shifting headquarters there.