The United States has the third highest marginal corporate income tax rate in the world, according to a new report from the Tax Foundation.
America’s corporate tax rate of 38.92 percent is the third highest out of 188 countries and tax jurisdictions. The United States corporate tax rate is exceeded only by the United Arab Emirates and Puerto Rico and is 16.4 percentage points higher than the worldwide average of 22.5 percent.
While the United States maintains its rank as having one of the highest corporate tax rates in the world, the overall worldwide tax rate has been declining.
"In 2003, the worldwide average was approximately 30 percent," the report states. "By 2016, the average rate had declined by roughly 7 percentage points to 22.5 percent."
When looking at different regions, North America has a higher corporate tax rate than Europe and Asia.
"Weighted by GDP, North America stands as the region with the highest average top marginal corporate tax rate of 37 percent," the report states. "Europe has the lowest average tax rate at 18.88 percent, 3.6 percentage points below the worldwide average of 22.49 percent."
"The corporate income tax rate is one of many aspects of what makes a country’s tax code and economy attractive for investment," the Tax Foundation wrote. "However, as the rest of the world’s economies mature and their tax rates on corporate income continue to decline, the United States risks losing its competitive edge due to its exceptionally high corporate income tax rate."