Will America Erect an Iron Tax Curtain around us to Keep Corporations in?

In a powerful and profound Editorial this week, The Wall Street Journal presents new information from the Tax Foundation that America’s tax burden on businesses is nearly the worst in the industrialized world.  That’s right, America is ranked number 32 out of 34 of industrialized nations that are part of the OECD (Organization for Economic Co-operation and Development).  This ranking is from a new index that utilizes 40 tax policy variables in its index.  If that’s not enough bad news, there are some who want to raise the taxes even further, and erect barriers for corporations that seek to flee America, looking for a reduced tax burden.

The new index is called the International Tax Competitiveness Index.  It measures the taxation on businesses and on investment.  Obviously, nations with more favorable tax burdens on business and investment will lure more corporations to invest in their countries or to simply relocate to the more favorable tax climate.

Currently, America’s corporate tax rate (including State taxes) is a very high 39+%.   Plus, U.S. corporations are also being asked to pay taxes on money earned overseas.

If you work for a U. S. company, remember that research shows that a high tax burden is associated with lower wages.  Makes sense when you think about it.

As high as the current tax burden is, it makes no sense to change our tax laws to make it more difficult for corporations to relocate.  We don’t need a iron tax curtain, like the old political “iron curtain” used by cold war communist countries.  A better solution for America and its economic growth is simply to make America more competitive in the global marketplace with lower corporate tax rates.

To read more about economic freedom, you can read my new book: Renewing America and Its Heritage of Freedom, available in print and e-book editions.