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Making the United States Less Competitive

Created on February 17, 2011

Making the United States Less Competitive

Making the United States Less Competitive

In 1990, Germany’s rate (54.5%) was the highest in the OECD, but by 2010 it was down 24.4 percentage points, the largest 20-year decline in the OECD.

Nearly two-thirds of the OECD have rates between 24% and 31%.

The OECD average has dropped by nearly 16 percentage points since 1990.

The United States currently has the second-highest rate (39.2%), behind only Japan. In 1990, the U.S. rate was the 16th-highest of 23 countries.

Ireland

  U.K.

  U.S.

  Germany

  Japan

  Each line represents a nation in the OECD

  COMBINED CORPORATE INCOME TAX RATE IN THE OECD

  To attract business and investment in a fiercely competitive global marketplace, every industrialized country except the United States has lowered its corporate income tax over the past 20 years. The United States has bucked that trend and increased its rate, creating a less-hospitable environment for corporations.

  Change

  Nation

  Japan

  U.S.

  France

  Belgium

  Germany

  Australia

  Mexico

  Spain

  New Zealand

  Canada

  Luxembourg

  Norway

  United Kingdom

  Italy

  Portugal

  Sweden    

  Finland

  Netherlands

  OECD average

  Denmark

  Austria

  Korea

  Greece

  Switzerland

  Turkey

  Hungary

  Czech Republic

  Poland

  Slovak Republic

  Chile

  Iceland

  Ireland

  2010

  1990

  Chart 1 • B 2502

  heritage.org

 

  Source: OECD, “Taxation of Corporate and Capital Income (2010),” Table II.1. “Corporate Income Tax Rate,” at http://www.oecd.org/dataoecd/26/56/33717459.xls (December 9, 2010).