Academic studies show that higher corporate tax rates depress worker wages and lead to fewer jobs. An Organisation for Co-operation and Development (OECD) study has found that the corporate tax is the least efficient and most harmful way for governments to raise revenue.
The corporate tax component of our Index measures each state’s principal tax on business activities. Most states levy a corporate income tax on a company’s profits (receipts minus most business expenses, including compensation and the cost of goods sold), while some states levy gross receipts taxes, which allow few or no deductions for a company’s expenses.
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Increasing the corporate tax rate is often offered as a solution to income inequality because higher-income individuals tend to own more corporate shares than others and may bear the burden of a tax increase on corporate income.
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What has President Joe Biden proposed in terms of tax policy changes? Our experts provide the details and analyze the potential economic, revenue, and distributional impacts.
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A tax code that is competitive and neutral promotes sustainable economic growth and investment while raising sufficient revenue for government priorities.
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The difference that the OECD presents between the potential impact in the context of agreement compared to a harmful tax and trade war should show policymakers the value of continuing multilateral discussions.
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While the Biden campaign is certainly focused on increasing taxes on U.S. businesses and high-income earners, it is important that policymakers also understand what that reversal might do to U.S. competitiveness, and the competitive global environment in which U.S. companies and U.S. workers operate.
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While there is still plenty of work to be done to get unemployed Americans back to work, the U.S. economy as a whole is now recovering strongly from the pandemic-induced economic downturn, outperforming forecasts from earlier in the year and outperforming most other developed countries.
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Our International Index compares OECD countries on over 40 variables that measure how well each country’s tax system promotes sustainable economic growth and investment.
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The OECD released blueprints for proposals on changing international tax rules alongside an impact assessment based on the overall design of the proposals. While the blueprints cover proposals both for changing where large multinationals owe corporate tax and designing a global minimum tax, there are still many unanswered questions. In the meantime, other digital tax proposals are moving forward and have the potential to result in a harmful tax and trade war.
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A competitive tax code has never been more important, and these tax policy improvements can both strengthen the short-term economic recovery and promote long-term economic growth in Nebraska.
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State throwback and throwout rules may not be widely understood, but they have a notable impact on business location and investment decisions and reduce economic efficiency for the states which impose such rules.
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Heading into Election Day, the Illinois legislature and Governor J.B. Pritzker (D) are trying to convince voters to scrap a key constitutional feature of Illinois’ tax system: a provision in the state constitution that prohibits a graduated-rate income tax.
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Depending on the outcome of the 2020 presidential election, we could be looking at a very different tax code in the years to come. What tax changes has former Vice President Joe Biden proposed and what would they mean for U.S. taxpayers, businesses, and the overall economy?
State tax revenue collections were down 5.5 percent in FY 2020, driven by a dismal final quarter (April through June) as states began to feel the impact of the COVID-19 pandemic. While these early losses are certainly not desirable, they are manageable and far better than many feared.
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Over the last two decades, corporate income tax rates have declined around the world. Our new map shows the most recent changes in corporate tax rates in European OECD countries, comparing how combined statutory corporate income tax rates have changed between 2017 and 2020.
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Biden’s tax vision is twofold: higher taxes on high-income earners and businesses paired with more generous provisions for specific activities and households.
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What tax policy ideas did Harris propose along the campaign trail, and how do they differ from Biden’s plan?
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First, the introduction of the wealth tax would significantly impact international capital flows and cause large economic dislocations in the short term. Second, provinces that are looking at raising their corporate tax rates might hinder capital attraction, growth, and economic recovery.
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