Tax Foundation TV, Radio Ads Show That Corporate Income Taxes Cost the Average American Household $3,190

March 2, 2009

Today, the Tax Foundation started running a 30 second television ad and a 60 second radio ad in the Washington, D.C. market to educate Americans about the burden that American families bear from the corporate income tax.

The Tax Foundation will run the ads on six different cable television stations (News Channel 8, CNN, Headline News, MSNBC, CNBC and Fox News) and three different radio stations (WTOP, WMAL and 1580 Big Talk) in the Washington, D.C. market for the next two weeks (March 2-13). These ads are running as a part of the CompeteUSA project, a campaign which aims to raise the public’s awareness of America’s high business taxes and how those taxes are affecting our competitiveness, wages and living standards.

The ads are created by Craig Kirchoff of Alexandria, VA, a winner in the Tax Foundation’s CompeteUSA YouTube Contest held last October. They show that “Sally” and her family are burdened with corporate income taxes through lower wages and higher prices at the store.

30-Second Television Ad

60-Second Radio Ad

“Most people think that corporate income taxes are paid by wealthy, anonymous companies,” said Scott Hodge, President of the Tax Foundation. “But as economists have been teaching for years, people bear the burden of corporate taxes, not companies.”

Research from the Congressional Budget Office shows that in a global economy where capital is highly mobile but workers can’t easily move aborad, workers end up bearing the brunt of corporate taxes. In 2007, Economist William Randolph found that 70 percent of corporate tax burdens fall on employees through lower wages and productivity, while the remaining 30 percent fall on company shareholders. A recent Tax Foundation study shows the federal corporate income tax alone collected $370 billion in 2007. That’s an average household burden of $3,190 per year – more than the average household spends on restaurant food, gasoline or home electricity in a year.

“Typically, the argument for cutting the U.S. corporate tax rate centers on improving the ability of American companies to compete globally,” said Hodge. “While true, those arguments overlook the fact that individual households bear the corporate tax burden, and their pocketbooks will benefit most from reform.”

The Tax Foundation’s TV ad can be found on YouTube at

The radio ad can be found at

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