US Corporate Tax Rates vs. All OECD Countries
 |  December 27, 2008

Comparing US Corporate Tax Rates to 30 OECD Countries (2008)
OECD stands for the international Organisation for Economic Co-operation and Development, an organization of thirty (30) countries that accept the principles of representative democracy and free-market economy. (Wikipedia)

OECD Overall Rank Country/State Federal Rate Adjusted Top State Corporate Tax Rate Combined Federal and State Rate (Adjusted) (a) US Rank
  Iowa 35 12 41.6 1
  Pennsylvania 35 9.99 41.5 2
  Minnesota 35 9.8 41.4 3
  Massachusetts 35 9.5 41.2 4
  Alaska 35 9.4 41.1 5
  New Jersey 35 9.36 41.1 6
  Rhode Island 35 9 40.9 7
  West Virginia 35 9 40.9 8
  Maine 35 8.93 40.8 9
  Vermont 35 8.9 40.8 10
  California 35 8.84 40.7 11
  Delaware 35 8.7 40.7 12
  Indiana 35 8.5 40.5 13
  New Hampshire 35 8.5 40.5 14
  Wisconsin 35 7.9 40.1 15
  Nebraska 35 7.81 40.1 16
  Idaho 35 7.6 39.9 17
  New Mexico 35 7.6 39.9 18
  Connecticut 35 7.5 39.9 19
  New York 35 7.5 39.9 20
  Kansas 35 7.35 39.8 21
  Illinois 35 7.3 39.7 22
  Maryland 35 7 39.6 23
  North Dakota 35 7 39.6 24
1 Japan 30 11.56 39.54  
  Arizona 35 6.968 39.5 25
  North Carolina 35 6.9 39.5 26
  Montana 35 6.75 39.4 27
  Oregon 35 6.6 39.3 28
2 United States 35 6.57 39.27  
  Arkansas 35 6.5 39.2 29
  Tennessee 35 6.5 39.2 30
  Washington * 35 6.4 39.2 31
  Hawaii 35 6.4 39.2 32
3 Germany 26.38 17 38.9  
  Michigan * 35 6 38.9 33
  Georgia 35 6 38.9 34
  Kentucky 35 6 38.9 35
  Oklahoma 35 6 38.9 36
  Virginia 35 6 38.9 37
  Florida 35 5.5 38.6 38
  Louisiana 35 8 38.5 39
  Missouri 35 6.25 38.4 40
  Ohio 35 5.1 38.3 41
  Mississippi 35 5 38.3 42
  South Carolina 35 5 38.3 43
  Utah 35 5 38.3 44
  Colorado 35 4.63 38 45
  Alabama 35 6.5 37.8 46
4 Canada 22.1 14 36.1  
  Texas * 35 1.6 36.0 47
  Nevada 35 0 35.0 48
  South Dakota 35 0 35.0 49
  Wyoming 35 0 35.0 50
5 France 34.43 0 34.4  
6 Belgium 33.99 0 33.99  
7 Italy 33 0 33  
8 New Zealand 33 0 33  
9 Spain 32.5 0 32.5  
10 Luxembourg 22.88 7.5 30.38  
11 Australia 30 0 30  
12 United Kingdom 30 0 30  
13 Mexico 28 0 28  
14 Norway 28 0 28  
15 Sweden 28 0 28  
16 South Korea ** 25 2.5 27.5  
17 Portugal 25 1.5 26.5  
18 Finland 26 0 26  
19 Netherlands 25.5 0 25.5  
20 Austria 25 0 25  
21 Denmark 25 0 25  
22 Greece 25 0 25  
23 Czech Republic 24 0 24  
24 Switzerland 8.50 14.64 21.32  
25 Hungary 20 0 20  
26 Turkey 20 0 20  
27 Poland 19 0 19  
28 Slovak Republic 19 0 19  
29 Iceland 18 0 18  
30 Ireland 12.5 0 12.5  
OECD Overall Rank Country/State Federal Rate Adjusted Top State Corporate Tax Rate Combined Federal and State Rate (Adjusted) (a) US Rank
*Michigan, Texas and Washington have gross receipts taxes rather than traditional corporate income taxes. For comparison purposes, we converted the gross receipts taxes into an effective CIT rate. See Tax Foundation Notes (link below) for methodology.
** On June 3, 2008, South Korea’s Ministry of Strategy and Finance announced that it will cut the maximum corporate tax rate from 25% to 22% to stimulate economic growth. (Source: Xinhua)
(a) Combined rate adjusted for federal deduction of state taxes paid

Data compiled from: http://www.taxfoundation.org/publications/show/22917.html
Source: OECD, http://www.oecd.org/dataoecd/26/56/33717459.xls

6 Responses to “US Corporate Tax Rates vs. All OECD Countries”

  1. 1) |  Top | Mar 04 2009 | Pierre Gosselin

    Wow!
    I am surprised. After constantly telling the Europeans the US is the place to do business and to enjoy freedom, I feel like I’ve just stepped in it.

    And this is before the Obama tax hike?
    And then there’s cap and trade for energy use that will be piled on top of that?
    Hello mass unemployment!

  2. 2) |  Top | Mar 09 2009 | rhg

    This chart is a bit misleading for Canada, because there are two rates:
    1. Small businesses (less than $250,000 in revenue).
    2. All other businesses.

    The small business rate is significantly lower. In addition, each province has a different income tax rate.

    In British Columbia, for example, the combined rate for small business is well under 20%.

  3. 3) |  Top | Mar 13 2009 | Chris Banescu

    Thanks for the additional detail “rhg.” Your information makes Canada look even better. The OCED data was averaged across all the various businesses and corporations for each country, so the lower rates for some regions and for lower income levels makes sense.

  4. 4) |  Top | Apr 07 2009 | LBB

    I have a question. Someone told me that US Corps have many writeoffs/loopholes so American corporations do not pay at highest rate ( or second according to your chart) Is there any truth to this?

  5. 5) |  Top | Apr 07 2009 | Chris Banescu

    LBB, Companies are allowed to deduct their business expenses (write-offs) from their gross revenues to determine their real earnings. That’s how every corporation, business, sole-proprietorship, and self-employed individual determines what net earnings they have earned. It would make no sense to tax them on their gross revenues.

    Often, for quite a few businesses (especially start-ups, mismanaged companies, or during bad economic times) in certain years, their expenses equal or exceed gross revenues. In those years, their real earnings are zero or below zero, therefore they do not pay any corporate tax, and they shouldn’t because they did not earn anything. It would be vastly unethical and illogical for them to pay taxes on zero real income.

  6. [...] 1 US Corporate Tax Rates vs. All OECD Countries [...]