US now has highest corporate tax rates in the world (Not an April Foll's joke)

American Thinker ^ | 03/31/2012 | Rick Moran

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This OECD chart (bottom of the page) published by Heritage says it all:

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The U.S. rate is well above the 25 percent average of other developed nations in the Organization for Economic Cooperation and Development (OECD). In fact, the U.S. rate is almost 15 percentage points higher than the OECD average.

This gaping disparity means every other country that we compete with for new investment is better situated to land that new investment and the jobs that come with it, because the after-tax return from that investment promises to be higher in those lower-taxed nations.

Our high rate also makes our businesses prime targets for takeovers by businesses headquartered in foreign countries, because their worldwide profits are no longer subject to the highest-in-the-world U.S. corporate tax rate. Until Congress cuts the rate, more and more iconic U.S. businesses such as Anheuser-Busch (which was bought by its Belgian competitor InBev in 2008) will be bought by their foreign competitors.

To get back in line with international norms, Congress needs to reduce the rate so the combined federal and state rate matches or falls below the OECD average. Some will contend that with deficits north of $1 trillion annually, we simply can't afford such a large rate reduction. But the actions of the nations we compete with for new investment show that these nations understand that lowering the corporate tax rate is necessary because of the boost to economic growth it provides.

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Only recently have GOP candidates been pushing a corporate tax cut that would make us more competitive. Mitt Romney has made it the centerpiece of his plan to revitalize the economy. Of course, the Democrats resist the idea, unless there are corresponding tax increases on the "rich,"

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We take the title as Japan cuts its tax rate by five percent. America’s business tax rate now tops out at 35 percent.

Add state taxes and American job creators face a median rate of 39.2 percent.

The United States was in the middle of the pack when we last changed our rates in 1993. Since 2000, however, 30 of the world’s leading developed countries — looking to boost their economies — have cut their rates.

Germany dropped its top rate by 22 points.

Canada cut its by 13 points.

Ours stayed the same.

Today the worldwide average is 25 percent.

Even Russia, at 20 percent, and China, at 25 percent, have lower rates than America does. The difference in tax rates means American companies are trying to compete with one hand tied behind their backs.

Despite this disadvantage, Democrats in Washington have resisted calls to cut America’s exorbitant tax rates. They view corporations as bottomless wells of potential tax money. It doesn’t work that way in the real world.

[Coleus]

(Not an April Foll’s joke) >>>

What’s an April Foll’s joke? :)

[Sherman Logan]

The US also has many exemptions and deductions to this tax rate. Our effective corporate rate is not nearly as high. For instance, GE last year apparently paid zero or very nearly sop.

Don’t get me wrong, we should greatly reduce the rate and get rid of all exemptions and subsidies. They amount to corporate welfare and crony capitalism. But the point is that the theoretical rate is not paid by many if not most large corporations.

[virgil]

Ireland’s corp tax rate is 12%. That’s where my job is going.