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Highest in the world

Posted on 2012-03-30
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Come Sunday, the US will have the highest corporate tax rate in the world.

Is that a good thing?

http://washingtonexaminer.com/politics/washington-secrets/2012/03/we%E2%80%99re-no-1-highest-corporate-taxes/424571
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Question by:carsRST
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5 Comments
 
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Expert Comment

by:sbdt8631
ID: 37788146
Immaterial.  Between exemptions to avoid paying and dodges to stow profit off shore where they pay no tax, the nominal rate is meaningless.

http://abcnews.go.com/Politics/general-electric-paid-federal-taxes-2010/story?id=13224558
General Electric Paid No Federal Taxes in 2010

http://business.time.com/2012/03/19/apple-plans-10b-stock-buyback-to-avoid-tax-on-foreign-cash/
"On a conference call Monday morning, Apple executives said the move will allow the company to avoid paying incomes taxes to repatriate some $64 billion, which it is currently holding outside the United States."
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LVL 17

Expert Comment

by:Anthony Russo
ID: 37788167
Agree with sbdt8631 on this. The bigger corporations skirt the taxes anyway, which sucks.
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Author Comment

by:carsRST
ID: 37788263
GE might not be a good example.  The CEO is on Obama's job council and the two are good friends.  Not to mention GE has moved jobs to China.

But to pick one company and extrapolate that tax rates don't affect a company's behavior is certainly juvenile.

Texas alone has benefited tremendously from California's high corporate tax rates.  Companies and the associated jobs have moved.

Higher tax rates also affect foreign investment and push existing companies and jobs to areas with less government income confiscation.
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sbdt8631 earned 100 total points
ID: 37788352
http://www.csmonitor.com/Business/Tax-VOX/2011/0209/Corporate-tax-only-a-piece-of-tax-revenue-pie
"Indeed, even though the U.S. corporate rate is the second highest in the world, corporate tax revenues amounted to only about 1.3 percent of Gross Domestic Product last year–less than half the average among major industrialized countries."

Picking one company as an EXAMPLE does not imply that it is the only company doing it.  GE is the easy pick because it is so well known.
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LVL 17

Assisted Solution

by:Anthony Russo
Anthony Russo earned 100 total points
ID: 37788402
>>Picking one company as an EXAMPLE does not imply that it is the only company doing it.  GE is the easy pick because it is so well known.

Agree. Most all the bigger companies do it.

>>Higher tax rates also affect foreign investment and push existing companies and jobs to areas with less government income confiscation.

Agree with this too though. Raising the tax rate isn't the answer. Getting rid of the loopholes so the big guys pay is what needs to be done.
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