With the second highest corporate tax rate in the world, the Small Business and Entrepreneurship (SBE) Council said the United States needs to provide tax relief for U.S. business to better compete in the world economy.
The United States’ 40 percent tax rate (federal plus state average) ranks 170th among 171 nations with only the United Arab Emirates imposing a higher rate (55 percent), explained Raymond Keating, SBE’s chief economist.
The U.S. corporate tax rate outdistances the global average of 24.29 percent; the Americas average of 28.29 percent; the EU average of 21.51 percent; the Asia average of 21.28 percent; and the OECD average of 24.27 percent, Keating added.
He said a high corporate tax burden hinders small and medium-size companies, as well as large corporations.
“The need to provide substantial relief in terms of reducing the corporate tax rate is clear,” Keating said.
Keating said that if the rate was reduced to 15 percent, as proposed by the Trump Administration, the United States would then be tied (with 11 other nations) for 25th among those 171 nations.
“That would be a breathtaking improvement in the nation’s competitive tax position, again, to the benefit of so many small businesses, and the U.S. economy in general,” Keating said.