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Iowa, other US states lead world in high corporate taxes

Nearly half of US states, including most of the most populous states, have combined state/federal corporate tax rates higher than even Japan (the country with the overall highest national rate), according to Paul L. Caron at Tax Prof. Read the report from The Tax Foundation and see the entire list of states and countries at the link.

These rates do NOT include, naturally, the extra penalty the United States imposes on the overseas earnings of US-based corporations. Unlike virtually all other leading industrialized nations, we tax those earnings as soon as they are "repatriated" - brought home. As long as the overseas profit stays overseas, and is reinvested in the foreign country in which it was earned, it isn't taxed.

And we wonder WHY so many companies move their headquarters "offshore" these days! Wouldn't you, if simply declaring another office your "home base" allowed you to exempt a good bit of income from taxation? Of course, we also give a heavy incentive to our companies NOT to bring their overseas profits home . . .


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Comments (6)

This has been occuring for ... (Below threshold)

This has been occuring for quite a while. Its also why when there is a merger between a US company and a foreign company, the foreign company is always named at the buyer, even if it was the US company actually doing the purchasing. US corporate taxes are way to high.

Ireland figured this out...... (Below threshold)

Ireland figured this out.....years ago.

http://www.taxfoundation.org/news/show/175.html


Though the American corpora... (Below threshold)
Steve Crickmore:

Though the American corporate tax rate is 35%,(McCain wants to reduce it to 25%) American corporations pay relatively less in taxes, compared to other industralized countries, due to the many tax deductions and credits such as interest deductibility and acceleration depreciation.. the American progress action site makes this argument.

No wonder they need those e... (Below threshold)
SteveC:

No wonder they need those ethanol mandates in Ioway.

Though the American corp... (Below threshold)

Though the American corporate tax rate is 35%,(McCain wants to reduce it to 25%) American corporations pay relatively less in taxes,

I picked these at random. Looks to me like they are paying a lot of taxes...


http://moneycentral.msn.com/investor/invsub/results/statemnt.aspx?Symbol=XOM

http://moneycentral.msn.com/investor/invsub/results/statemnt.aspx?Symbol=MSFT

http://moneycentral.msn.com/investor/invsub/results/statemnt.aspx?Symbol=GOOG


In the case of these three companies, why not eliminate the tax on profits and return the money to shareholders, hundreds of thousands of whom are middle class Americans.

And any company that has an... (Below threshold)
COgirl:

And any company that has any operation in California has to pay state income tax on their worldwide earnings. Maybe it's the same in other states too (I know it's not the case in Colorado), I just happen to be familiar with California.

With U.S. corporations paying so much in taxes, don't you wonder why Dems continue to oppose big business? Kind of like shooting yourself in the foot.

And let's not forget that there is also double taxation on corporate earnings. The company pays the tax, then pays a dividend and shareholders pay tax on the dividend. It's a racket.




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