Burger King’s announcement that it will move its headquarters to Canada has put the spotlight on that country's tax system. However, the tax benefits of doing business in Canada, as opposed to doing business in the U.S. are not well-known.
First, Canada has a much lower corporate tax rate: 15 percent at the federal level plus another 11 percent on average from provincial corporate taxes. Compare that to the U.S. federal corporate tax rate of 35 percent, plus an average state corporate tax rate of about 4 percent.
Two Bites at the Burger
Canada has a territorial tax system, with no additional repatriation tax on foreign profits. The U.S. has a worldwide tax system, which applies a repatriation tax to foreign profits when those profits are brought back to the U.S.
The repatriation tax is basically the difference between the foreign corporate tax rate and the U.S. corporate tax rate, typically exceeding 10 percent. The average foreign corporate tax rate in the developed world is 25...
The Obama administration has hailed the“cash-for-clunkers” stimulus program for its part in the automobile industry recovery.
But a recent study is putting the program that ended in 2009 back in the news and highlighting its alleged failures.
Economists from Texas A&M University evaluated the stimulus program and found it cost the automobile industry billions of dollars. The study –"Cash for Corollas: When Stimulus Reduces Spending" -- highlighted how the environmental objectives of the...
Though conservative “red” states have more competitive tax systems and regulatory systems, legislators in many liberal “blue” states are beginning to respond with good reforms of their own, according to the latest release of the American Legislative Exchange Council’s Rich States, Poor States report.
In all, 17 states enacted important tax reforms in 2013, making it “a standout year for tax changes in the states,” according to the authors.
ALEC released the report’s State Economic...