Do U.S. Companies Pay Higher Taxes Than Competitors Around the World?

What's Hot

Do This or Your iPhone Bill May SkyrocketSave

23 Upgrades Under $50 to Make Your House Look AwesomeAround The House

Trump Worth $10 Billion Less Than If He’d Simply Invested in Index FundsBusiness

11 Places in the World Where You Can Afford to Retire in StyleMore

What You Need to Know for 2017 Obamacare EnrollmentFamily

8 Things Rich People Buy That Make Them Look DumbAround The House

32 of the Highest-Paid American SpeakersMake

Amazon Prime No Longer Pledges Free 2-Day Shipping on All ItemsMore

More Caffeine Means Less Dementia for WomenFamily

9 Tips to Ensure You’ll Have Enough to RetireFamily

30 Awesome Things to Do in RetirementCollege

5 Spots Where Retirees Can Live for Less Than $40,000Real Estate

10 Ways to Reduce Your Homeowner’s Insurance RatesFamily

10 Ways to Pull Together the Down Payment for a HomeCredit & Debt

Chew on This: The Story Behind Your Hershey’s Halloween TreatsBusiness

It's a common belief that the United States offers lower income tax rates than most other developed countries. Like many common beliefs, this one is wrong.

When faced with the choice of taxing companies more or raising the taxes of individuals, most people would probably choose to tax corporations. After all, they’re the ones with all the money, right?

While it’s natural to want to pass the buck to anyone other than ourselves, the problem is that raising income taxes on corporations may serve to lower your personal taxes in an untended and unpleasant way: by getting you laid off.

The world economy is increasingly global. While not all companies directly compete with others around the world, many do. If the company you work for pays less income taxes than a similar company in another country, it’s more profitable and therefore more likely to expand and hire workers, rather than lay them off.  So while you may not wish higher taxes on yourself, wishing them on corporations isn’t a great idea either.

With that in mind, here’s a look at some corporate taxes around the world, according to the Tax Foundation. Per this article, the United States has the highest corporate tax rates among the 34 member countries in the Organization for Economic Cooperation and Development (OECD). Here are the top 15…

  1. United States: 35 percent
  2. Japan: 34.54 percent
  3. France: 34.4 percent
  4. Belgium: 33.99 percent
  5. Germany: 30.18 percent
  6. New Zealand: 30 percent
  7. Spain: 30 percent
  8. Australia: 30 percent
  9. Mexico: 30 percent
  10. Luxembourg: 28.59 percent
  11. Canada: 28 percent
  12. United Kingdom: 28 percent
  13. Norway: 28 percent
  14. Italy: 27.5 percent
  15. Portugal: 26.5 percent

And it gets worse: The above list doesn’t represent an apples-to-apples comparison. Because while this list includes the complete income tax burden for the non-U.S. countries listed, it doesn’t include state income taxes for U.S. companies. Here are the combined state and federal top rates for the states with the highest taxes…

  1. Iowa: 41.6 percent
  2. Pennsylvania: 41.5 percent
  3. Minnesota: 41.4 percent
  4. Illinois: 41.2 percent
  5. Alaska: 41.1 percent

Bottom line? For the United States to compete in a global environment, the lower our corporate tax rates, the better. But with both federal and state budgets hemorrhaging red ink, relief isn’t likely to come along anytime soon.

Stacy Johnson

It's not the usual blah, blah, blah

I know... every site you visit wants you to subscribe to their newsletter. But our news and advice is actually worth reading! For 25 years, I've been making people richer without making their eyes glaze over. You'll be glad you did. I guarantee it!


Read Next: 7 Ways to Save More at Big Lots

Check Out Our Hottest Deals!

We're always adding new deals and coupons that'll save you big bucks. See the deals to the right and hundreds more in our Deals section.

Click here to explore 1,724 more deals!