Tax Foundation reports on worldwide corporate tax rates; U.S. among highest

Last week the Tax Foundation issued a report on corporate tax rates around the globe. In terms of statutory tax rates (the rate as written in law, as opposed to the effective rate which is the amount actually paid), the U.S. has the fourth highest in the world and the highest among industrialized countries.

From the report's introduction:

It is commonly known that the United States has the highest statutory corporate income tax rate in the industrialized world. However, less is known about how the United States measures up against the rest of the world. By expanding the sample of tax jurisdictions from the 35 OECD member states to 202 countries and tax jurisdictions around the world, we find the United States corporate tax rate of 38.91 percent is the fourth highest rate in the world. The United States statutory corporate income tax rate is 15.92 percentage points higher than the worldwide average, and 9.5 percentage points higher than the worldwide average weighted by gross domestic product (GDP). The worldwide corporate tax rate has declined significantly since 1980 from an average of 38 percent to 22.96 percent. Today, most countries have corporate tax rates below 30 percent.

The report concludes:

The last time the United States reduced its federal corporate income tax rate was in 1986. Since then, countries throughout the world have significantly reduced their statutory tax rates. Today, the United States statutory corporate tax rate is one of the highest in the world and stands well above the worldwide average. Reducing the statutory corporate tax rate to around the worldwide average as part of tax reform could discourage profit shifting and encourage companies to locate investment in the United States.

You can read the entire report here.

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