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Is was my understanding it moves our nominal rates in line with the rest of the world, but this reduces our effective rates to below the rest of the world.
by JamesBarney 7y ago
Is was my understanding it moves our nominal rates in line with the rest of the world, but this reduces our effective rates to below the rest of the world.
- rayiner 7y agoIt’ll take a few years for the data to play out, but that’s likely not the case. A CBO study found that our effective corporate tax rate before the Trump tax cut was 18.6%. https://www.npr.org/2017/08/07/541797699/fact-check-does-the-u-s-have-the-highest-corporate-tax-rate-in-the-world https://www.npr.org/2017/08/07/541797699/fact-check-does-the.... France, Australia, and Canada were from 8.5-11.2%. The Trump tax cut dropped the nominal rate by about 1/3 (accounting for state corporate taxes, which didn’t change). Assuming a proportional drop in the effective rate (which is a wild ass guess), that would move us below Brazil, Germany, and India, but keep us slightly above France, Canada, And Australia. The US media coverage of Trump’s corporate tax cuts really misrepresented how completely mainstream it was: https://object.cato.org/sites/cato.org/files/wp-content/uploads/corp_tax_rates.png https://object.cato.org/sites/cato.org/files/wp-content/uplo.... While the US nominal rate of almost 40% total was around the OECD average in 1990, the rest of the OECD dropped to just over 20% by 2017. Meanwhile, the US nominal rate didn’t drop at all.
- JamesBarney 7y agoAhh ok thanks for the information and the links I appreciate it. So the tax cut brought us from the top of the pack to the middle of the pack.