When a corporation moves its headquarters to a low-tax nation

Tax haven

A tax haven is a state or a country or territory where certain taxes are levied at a low rate or not at all while offering due process, good governance and a low corruption rate....

 or corporate haven

Corporate haven

A corporate haven is a jurisdiction with laws friendly to corporationsthereby encouraging them to choose that jurisdiction as a legal domicile.- History :...

 while retaining its material operations in its higher-tax country of origin, this is termed to be a corporate inversion.

Corporate inversion is a form of tax avoidance

Tax avoidance

Tax avoidance is the legal utilization of the tax regime to one's own advantage, to reduce the amount of tax that is payable by means that are within the law. The term tax mitigation is a synonym for tax avoidance. Its original use was by tax advisors as an alternative to the pejorative term tax...

.

Corporate inversions as a tax-reduction maneuver have become a public policy issue, as substantial tax revenues are lost.