Some interesting comments coming in on a study we published this week on corporate taxes — the big payers and those who pay very little. (Here’s the link to interactive tables of both ends of the spectrum: the high and low.)
One reader tells how taxes affect corporate actions in important ways:
I worked for a large multinational who had large operations in the U.S. I did strategic planning and analysis for global sourcing. Effective tax rate for the U.S. portion of this multinational was 39% (state and federal), while operations in Switzerland and Belgium had effective tax rates of 3% and o% respectively… As a result, we closed/moved existing U.S. facilities, and made new capital investments there as these low tax rates favored those countries even though labor and utilities and distribution costs (back to the U.S.) were significantly higher. Don’t let anyone tell you that high U.S. corporate tax rates don’t cause U.S. businesses to move offshore. I experienced it first hand.
Other readers wrote about small businesses, companies that don’t have the resources to take full advantage of the tax code’s many corporate breaks. Some comments debate the alternative to the convoluted tax code: a sales tax across the economy.
Taxes are one of the murkiest areas of corporate finance to get a handle on. These are important perspectives that add a lot to the story.
So if you’ve seen corporate taxes up close, please add your two cents. (If you still have them after April 15.)
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