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To be fair though, a lot of the more advanced European countries have much lower corporate tax rates than the US does (or at least did). E.g. Sweden's is 22% an
by nv-vn 8y ago
To be fair though, a lot of the more advanced European countries have much lower corporate tax rates than the US does (or at least did). E.g. Sweden's is 22% and there's no state corporate income tax rate on top of that. In fact, the US was one of only a few highly developed countries with an above-average corporate income tax rate until the recent tax cuts, with higher tax rates than all of Europe, China, South Korea, Japan, Australia, Canada, etc. [1]. There are a lot of data indicating that low corporate tax rates do just as much if not more than low income tax rates to spur innovation/entrepreneurship.
[1] https://files.taxfoundation.org/20170113143228/World-Combined-Statutory-Rates-01.png https://files.taxfoundation.org/20170113143228/World-Combine...
- Eridrus 8y agoI don't think high corporate taxes make sense, but I'm not convinced they would have much effect on entrepreneurship. By definition they are taxes on profits, and corporations can deduct a lot more from their taxes than people can. As someone who has considered starting a startup, corporate tax rates have never really concerned me since the biggest hurdle is just getting back a comparable salary for myself, and anything else, e.g. smoothing income over multiple years, is just gravy. I don't think this logic would be very different for more traditional small businesses either. And even before the recent changes, effective US tax rates were not significantly different from effective EU tax rates: https://www.cbpp.org/research/federal-tax/actual-us-corporate-tax-rates-are-in-line-with-comparable-countries https://www.cbpp.org/research/federal-tax/actual-us-corporat... Also, colour-coded maps are a terrible way to make actual comparisons.