All Tied Up


Are Taxes Handicapping Corporate America?

INSIGHT Magazine
February/March 2010

Douglas S. Stransky was quoted in the February/March 2010 issue of INSIGHT Magazine in an article entitled "All Tied Up." The article discusses whether the high U.S. corporate tax rate, which is the second highest in the world, is handicapping corporate America. 

In support of the view that the high U.S. tax rate puts U.S. companies at a competitive disadvantage in the world economy, the article quotes Mr. Stransky, who explains that: “Their overall costs are higher than comparable companies conducting the same activities in other countries. For example, if a U.S. company earns $100 of profit in the United States, that company will pay a combined federal and state corporate tax of approximately 39 percent ($39), thereby realizing an after-tax profit of $61. In contrast, a company located in an OECD country, where the average statutory tax rate is approximately 26.5 percent, will realize an after-tax profit of $73.50 on that same $100,” he explains. “As such, a high U.S. corporate tax rate is a disincentive for U.S. companies to invest in the United States and to conduct high-profit activities in the United States.”