Report: Only France has higher corporate tax than US, by just 0.7%
By Paul Bedard | February 4, 2015 | 12:41 pm
The U.S. corporate tax rate is so high at 35.3 percent that only one other industrialized country, tax-heavy France, has a stiffer one, at 36 percent, according to a new Tax Foundation report that gives a key reason to why corporations are moving overseas.
Remarkably by comparison, countries like Denmark and Switzerland that provide citizens with more goodies than Washington have rates below 19 percent.
“The United States is prime for corporate tax reform” said Jack Mintz, author of the study geared to reviving the debate to cut the tax.
The report, posted below, found that most industrialized countries associated with the Organisation for Economic Co-operation and Development (OECD) have cut their rates over the past decade.
“Since 2005, 63 countries have cut their statutory corporate tax rate, lowering the average statutory tax rate to 24.4 percent across the 95 countries surveyed. Meanwhile, the U.S. corporate tax rate has remained stagnant,” said the report.
It also noted that the high U.S. rate is driving corporations overseas. President Obama has proposed taxing those overseas profits.
And compared to the 95 biggest economies, beyond the key OECD group, only five countries — Argentina, Chad, Uzbekistan, Colombia and France — have higher rates.
Other key findings:
-- The United States has the second highest marginal effective tax rate on corporate investment in the developed world at 35.3 percent — behind only France.
-- While the U.S.’s marginal effective tax rate has remained stagnant around 35 percent over the last 10 years, the average marginal effective tax rate on corporate investment has fallen by 2.9 percent in the OECD and 6.8 percent in the G7.
-- The lack of U.S. corporate tax competitiveness reduces investment and economic growth, undermines productivity, and encourages companies to move business to other countries.
-- Options to reform the U.S. corporate tax code include: reducing the top rate to 25 percent, limiting tax preferences, moving to a territorial tax system and improving the integration of the individual and corporate tax codes.
Paul Bedard, the Washington Examiner's "Washington Secrets" columnist, can be contacted at pbedard@washingtonexaminer.com.
http://www.washingtonexaminer.com/report-only-france-has-higher-corporate-tax-than-us-by-just-0.7/article/2559794
