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January 6, 2014

Other Comments: The Empire Strikes Back

IPI expert referenced: Bartlett D. Cleland | In The News | Media Hit
  Forbes magazine

After years of watching companies flee the country, or at least consider it, the United Kingdom has begun aggressively reforming its corporate tax code by lowering its corporate tax from 28% to 24%. By 2015 that rate will drop to 20% for an overall tax rate decrease of nearly 29%. But the Britons didn’t stop there. They have also exempted foreign earned profits from almost all U.K. taxes.

The result is that companies are returning to the U.K., while others from all over the world, including from the U.S., Switzerland, Italy and China, are relocating to Britain. This corporate immigration wave is 80% larger than it was in 2009.

Meanwhile, the U.S. has taken a decidedly different approach. The 40% U.S. corporate tax rate, a tabulation including state and local taxes on average, remain the highest in the world.

—Bartlett D. Cleland, Institute for Policy Innovation


 

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