PropertyValue
?:author
?:datePublished
  • 2012-10-04 (xsd:date)
?:headline
  • Joe Kyrillos says United States has highest corporate tax rate in the world (en)
?:inLanguage
?:itemReviewed
?:mentions
?:reviewBody
  • Republican U.S. Senate hopeful Joe Kyrillos said increased revenues are needed to deal with the national debt, but the path to that goal isn’t paved with tax hikes. Rather, Kyrillos said, he wants to lower taxes to stimulate growth. Well, we're going to have to raise revenue and I want to do it through growth. I want to lower tax rates. I want to make sure that America doesn't have the highest corporate tax rate in the world, which is what we have now, and lower the rates for everybody, Kyrillos said during a debate tonight with his Democratic rival, U.S. Sen. Robert Menendez, that aired on NJTV. Are corporations in the United States subject to the highest tax rate in the world? The statutory rate for businesses is the highest among industrialized nations. But for the rate businesses actually pay -- what’s called the effective tax rate -- the United States ranks among the highest, but not at the very top, according to studies. We checked a nearly identical claim that Kyrillos made during an Aug. 20 interview on WOR-AM. Then he said, we've got the highest corporate tax rate in the world. We rated that statement Mostly True. At that time, a spokeswoman for Kyrillos cited the nation’s top statutory corporate tax rate of 39.2 percent. That rate is a combination of federal, state and local tax rates before any tax breaks are factored in. Japan used to have a higher statutory rate than the United States. But in April, Japan reduced its rate and the U.S. took first place among industrialized nations, according to the Tax Foundation, a business-backed group. So on that point, Kyrillos is right. Since businesses receive a number of tax breaks, the effective tax rate for corporations in the U.S. isn’t the world’s highest, but it’s still up there. More than a dozen of the most recent studies on effective corporate tax rates across the world found businesses in the U.S. paid an effective rate between 23 percent and 34.9 percent, according to a September 2011 report from the Tax Foundation. The effective rate varied between the studies the Tax Foundation looked at because of different methodologies. In those studies, the U.S. never ranked first in the world. But in 10 of the studies, the nation’s effective corporate tax rate ranked among the top five highest. It’s worth noting that an analysis by the left-leaning Citizens for Tax Justice along with the Institute on Taxation and Economic Policy, found that 30 Fortune 500 companies, including General Electric, didn’t pay any federal corporate income taxes over the 2008-2010 period. As for what is the better measure -- statutory rates or effective rates -- we found mixed views. Scott Hodge, the president of the Tax Foundation, told PolitiFact New Jersey in August that because statutory rates are fixed they make for better comparisons, whereas effective rates are unpredictable and vary across different industries. But Joseph Rosenberg, a research associate at the nonpartisan Tax Policy Center, said effective tax rates provide the best measure of comparison for overall tax burdens. Then Aparna Mathur, an economist with the conservative American Enterprise Institute, said in an e-mail that both are equally valid measures of looking at the burden of the corporate income tax. Our ruling Kyrillos repeated a claim he made before that the United States has the highest corporate tax rate in the world. That’s true for the nation’s statutory corporate tax rate among industrialized nations. When Japan lowered its statutory rate, the United States moved into first place. Even when accounting for various tax breaks, the effective rate is still among the highest. On the Truth-O-Meter, we rate this statement Mostly True. To comment on this ruling, go to NJ.com . (en)
?:reviewRating
rdf:type
?:url