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How the U.S. Corporate Tax Rate Compares to the Rest of the World

1 min readBy: Anton Aurenius

Most countries taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. some form of corporate income. However, the rates differ around the world, ranging from 0% in Bermuda to 55% in United Arab Emirates. The rest of the world, of course, falls somewhere in between. The GDP-weighted worldwide average is just under 30 percent. With most countries falling under the average, the United States faces strong competition for business investment.

(click on map to enlarge)

The map shows statutory tax rates for corporate income around the world. These rates include the federal, state, and local taxes where there are multiple levels of government. For example, the United States has the highest corporate income taxA corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. rate set at 35 percent at the federal level, but the average tax on corporate income at the state and local levels amounts to an additional 4 percent, which brings the total tax rate to 39 percent.

The majority of countries fall below the GDP-weighted worldwide average rate of around 30 percent. Most European countries fall below the worldwide average. Only France and Germany are above the average. Argentina, Brazil, France, India, Venezuela, the United States, and several African countries have corporate tax rates notably greater than the worldwide average.

Read Corporate Income Tax Rates around the World, 2016 for a complete list of corporate income tax rates by country.