Over the past thirteen years, countries across the globe have reduced their corporate income tax rates, considerably reducing the worldwide average tax rate (Figure 2). In 2003, the worldwide average was approximately 30 percent. By 2016, the average rate had declined by roughly 7 percentage points to 22.5 percent.

 

After weighting by GDP, the average top marginal corporate tax rate has declined less. This is mainly due to the fact that the United States, which makes up approximately 25 percent of world GDP, continues to have a high 38.92 percent corporate income tax rate that has not changed in more than 10 years. Nonetheless, the worldwide GDP-weighted average tax rate has declined from 34.1 percent to 29.5 percent in the last 10 years.

Both Roth and Pre-tax 401k exist now. Also Wall Street seems to love it. Market boomed today.

 

Market boomed because of French runoff election results and a stream of strong earnings reports.

Good read on the tax issue especially around the issue of corporate tax rate and how it doesn't effect as many businesses as people believe.Also talks about the potential provision to include business partnerships in this rate reduction.

 

The 3 Questions That Will Decide If Trump’s Tax Plan Works | FiveThirtyEight

Pay for what ? Corporations keep money overseas now because of our high rates.

 

There needs to be spending cuts and deregulations to go along with this. But Corporate rate reduction has been a long time coming.

 

This is true....I dealt with this topic many years working for a global manufacturer. We had to fight to keep manufacturing of a product line in the US where it was designed, and could be better supported, because it could be built in China, and although manufacturing costs - including logistics - were similar, corporate accountants were espousing the 15% tax rate in China versus 39% in the US.

 

Over the past thirteen years, countries across the globe have reduced their corporate income tax rates, considerably reducing the worldwide average tax rate (Figure 2). In 2003, the worldwide average was approximately 30 percent. By 2016, the average rate had declined by roughly 7 percentage points to 22.5 percent.

 

After weighting by GDP, the average top marginal corporate tax rate has declined less. This is mainly due to the fact that the United States, which makes up approximately 25 percent of world GDP, continues to have a high 38.92 percent corporate income tax rate that has not changed in more than 10 years. Nonetheless, the worldwide GDP-weighted average tax rate has declined from 34.1 percent to 29.5 percent in the last 10 years.

 

Could this be because profits are diverted to lower tax venues? The company I worked for did that every opportunity....why not?

Market boomed because of French runoff election results and a stream of strong earnings reports.

 

Do you work in the industry?

Do you work in the industry?

 

I slept at a Holiday Inn Express last night.

 

Do you think the market run up was the tax plan? Today is the day more details on the tax plan are coming out and the market is up slightly at this point.

Could this be because profits are diverted to lower tax venues? The company I worked for did that every opportunity....why not?

Not sure, this just list what the Tax Rates are comparatively.

I slept at a Holiday Inn Express last night.

 

Do you think the market run up was the tax plan? Today is the day more details on the tax plan are coming out and the market is up slightly at this point.

 

In my experience the Market is emotional short term and the numbers play out long term. What the actual impact the plan will have can be debated but there isn't a guy on Wall Street who likes making money who did not trade with a bullish outlook based on news of a corporate tax reduction.

Will there be a corporate tax holiday to get the billions back in circulation from overseas?

Will there be a corporate tax holiday to get the billions back in circulation from overseas?

 

It didn't work the last time it was attempted.

Many loopholes to be closed with most deductions being cut but standard deductions doubling to over $24,000 for a married couple filing jointly. Single standard deduction also doubling to just over $12,000.

 

This is good news for most average Americans and bad news for some tax preparers as filing taxes should be greatly simplified if passed...H&R Block and some others will have a tougher time selling their services if the tax form is basically reduced to a 1040EZ for everyone.

It didn't work the last time it was attempted.

 

Maybe because there was no reduction in corporate taxes to go along with it at the time. I did see there was going to be a one time shot for companies to return money back home.

Maybe because there was no reduction in corporate taxes to go along with it at the time. I did see there was going to be a one time shot for companies to return money back home.

 

2004. One-time tax amnesty at a 5% tax rate. Companies used savings on stock buy backs. Cost Treasury $3.3B over 10 years.

2004. One-time tax amnesty at a 5% tax rate. Companies used savings on stock buy backs. Cost Treasury $3.3B over 10 years.

 

It didn't cost Treasury anything, if the 5% hadn't been offered all of the money would have just stayed overseas. It may have came in $3.3B under projections...but still drove a lot of revenue to the treasury that would not have occurred without the Tax Holiday. Treasury got an infusion of over $16B from the Tax Holiday.

 

 

Found this...

While critics point to that as evidence that the 2004 tax holiday was a failure from a reinvestment perspective, it was clearly a successful revenue event for the treasury, as it collected corporate taxes on presumably "shielded" profits. Also, the IRS collected capital gains taxes from shareholders who sold in the share repurchase programs.

 

Very informative but long read on the 2004 Tax Holiday Tax Analysts -- Effects of 24 Int'l Tax Holiday, Recommendations Going Forward