US Companies are Getting Out of Dodge, IRS in Hot Pursuit
The US is tied with Puerto Rico for the third highest corporate marginal income tax rate in the world (39%). The tax comes directly out of investment, employment, output, and taxable individual income from dividends, wages and salaries. And what does Treasury spend their tax collections for? Well, not roads, highways and bridges. After the Bush and Obama fiscal stimulus neither the shovel-ready nor the unready got funded. The Ds and the Rs now say they will set that straight… if we will but vote for them one more time again. Yeah, and elephants will fly.
So, US companies are getting out of Dodge with the IRS in hot pursuit. The simplest way to stop and reverse the hemorrhaging is to lower the tax to a good round number like 0. I am interested in what is wrong with this argument; why it is better to keep it at 39% and pursue the flight to foreign countries. Be the devils advocate here.
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