Corporate Taxes: Advantages of a Territorial System

Produced by the Tax Foundation in Washington, D.C. Script: Whether you know it or not, there’s a tax barrier to bringing money into the U.S. It sounds strang…
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  1. OldRangeRat says:

    What gets my goat – they import the product to American markets without any
    import tariffs. They should at least pay tariff equal to the 16% wage tax
    that American workers are take for the privilege of their daily drudgery.?

  2. thefredsays says:

    Lets ignore this crap to make the rich richer. US companies exploit
    loopholes to pay zero taxes anyway and get money from the government via
    corporate welfare.

  3. Michael Dell says:


  4. JohnnyMo28 says:

    very simple thought process as to why this is a horrible idea. my main
    company operates out of the u.s.; i do work for clients in the u.s. i take
    advantage of the legal system, the infrastructure, and other public goods
    most people pay taxes to support. however, payments are made to a
    subsidiary in bermuda, with no corporate tax rate, which i then am able,
    because of a territorial tax system, to being back free of charge.

  5. Ludwig Van Pictures says:

    So what is the disadvantages of territorial tax system?

  6. objectivistathlete says:

    According to the World Bank, the US had the second highest effective
    average corporate tax rate among OECD countries… And yes, the “effective”
    tax rate includes loopholes, deductions, and tax credits. Companies like GE
    are the exception, not the rule.

  7. Sasha32659 says:

    Just end the stupid corporate income tax already. Many multinationals don’t
    pay it anyway.

  8. false_flag says:

    Was this video made in 1801?

  9. nfrecker says:

    Also, of 34 countries in the Organization for Economic Co-operation and
    Development, twenty-five use territorial systems, with the United Kingdom
    and Japan having adopted them in 2009.

  10. Jean Nichols says:

    @123minax Thanks for the Reminder – makes Sense!


    Also, bring back income averaging. I’m self-employed on SS and FERS pension
    but if I sell a kid’s book I might make more in 1 year than the previous
    year or even the next 5 years so I have to pay income in 1 year that was
    really the efforts of 5 years.

  12. mouse4689 says:

    What the hell is this public education garbage. Raise the taxes and bring
    the jobs back to the USA.

  13. tm2wndrlnd says:


  14. pfitz007 says:

    You don’t pay taxes when you don’t have profits so 35% or any rate is
    irrelevant. You Americans need to stop your relaxed attitude to debt and
    leveraged buy outs. Take a leaf out of the Germans book, if you can’t pay
    in cash for that fancy car then don’t buy it, live within your means

  15. ABCED2277 says:

    Japan did until a couple months ago. It used to be about 40%. Now it is the
    US with it’s 35% corporate income tax rate. Japan lowered it. We might not
    be the nation with the highest for long. Our top 3 Presidential candidates
    want it lower, Mitt Romney wants it cut to 25%, Barack Obama wants it cut
    to 28% (like Ronald Reagan did) but 25% for manufacturing companies and
    Gary Johnson (from the Libertarian Party) wants to cut it to 0% and replace
    it with a 23% national sales tax.

  16. Sr. Shaggalot says:

    there are only a few countries that use the territorial tax system, such as
    Hong Kong and France, not “almost every other developed country.” Lowering
    the tax rate would fix a lot of the problems described in this video, but a
    territorial tax system is just putting more money in wealthy hands, and
    further increasing our national deficit. Don’t believe me? Do some research
    and don’t be sheeple!

  17. Jean Nichols says:

    Which country has the Highest tax rate?

  18. JohnnyMo28 says:

    it’s much easier and way more effective at stimulating the economy to close
    loopholes in all forms, lower marginal tax rates slightly, and give tax
    incentives to corporations who bring money back to the u.s. and use it to
    hire workers or buy locally-made goods/services.

  19. bakerjr12 says:

    So you don’t want to pay your taxes. Who does? Stop trying to rig the
    system more than it already is! You suppose this money would come home to
    hire workers but US companies invest if workers overseas, not here at home!
    This would only help the investers aka the rich.

  20. O. Lee Walker says:

    The fundamental truth that is disguised by politicians who want taxpayers
    to believe that corporations are carrying the tax load for them is this:
    Corporations do not pay taxes; they collect them from their customers in
    the form of higher prices. Taxes on a company are just another cost of
    doing business, just like labor and capital. Vast sums are spent in
    reducing all three of these. If the FairTax were passed there would be 0
    corp. tax, and the US would be THE place for companies to locate.

  21. Jean Nichols says:

    Both GE & GM CEOs are Big Buddies of obama, pay NO income taxes, and Most
    of their Employees are Overseas!!

  22. pfitz007 says:

    Stop blaming your problems on Obama and actually read this again. A company
    can’t magically raise the cost of its products, sorry actually they could
    by paying higher wages as you mentioned,therefore you Americans get big
    salaries which is a good thing 🙂 I think you mean raise PRICE, which would
    be disadvantageous to consumers but would raise profits and therefore
    taxes, but then again why would there be an incentive to do that

  23. dofeedthebears says:

    Corporations do not bring home profits to reinvest if there are no
    investment opportunities, they bring money for stock buy backs and dividend
    payments. Switching to a territorial system would only allow companies to
    do this without paying taxes that they owe, depriving the government the
    revenue they need, and increasing tax burden on everyone else.

  24. nfrecker says:

    I’m surprised about all of the economic illiterates here. From what I’ve
    been hearing people seem to think that it’s the super rich who pay the
    corporate income tax. Corporate incomes do not magically go into rich
    people’s pockets. In order to offset one of the largest corporate income
    taxes in the world, corporations typically do one of two things. They
    either raise the cost of their products (hurting product-buying Americans)
    or cutting costs, such as workers (hurting working-class Americans).


    Ok ,but let’s eliminate taxes on Social Security Income as well unless a
    USA taxpayer earns less than $50,000. I’m barely over the poverty level so
    my FERS pension contributes to my having to pay taxes on my SS Income. Come
    on, get it right!

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