US Corporate Tax 7-25-24

Trump is planning to lower US Corporate Taxes to make tax rates more competitive to attract manufacturing back to the US. Top Rates after 1945 for corporations averaged 50% for earnings over $25000. The Reagan Tax Cuts brought the Top Rate to 40% in 1987 and 34% in 1988. The Trump Tax Cuts brought the Top Rate to 21% in 2017. The 2017 top rate applies to all profits and doesn’t use brackets. 

Year(s)       Top Rate   Over

1946-1949     53%       $50K

1950-1951     42%       $25K

1951-1952     50.75%  $25K

1952-1963     52%       $25K

1964-1965     50%       $25K

1965-1967     48%       $25K

1968-1969     52.8%    $25K

1970-1971     49.2%    $25K

1971-1974     48%       $25K

1975-1978     48%       $50K

1979-1984     46%      $100K

1984-1986     46%      $1.405M

1987-1987     40%      $1.405M

1988-1992     34%      $335K

1992-1993     34%      $335K

1993-2016     35%      $18M

2017-2024     21%      $1

https://www.irs.gov/pub/irs-soi/02corate.pdf

In Ireland, the Corporate Tax Rate is 12.5%. Most of the big US companies have their sales offices in Ireland. The worldwide average statutory corporate income tax rate, measured across 181 jurisdictions, is 23.45%.

It was typical in the 1960s for US Companies to limit their taxable profits to 5%.

I was working at the Headquarters of Monsanto Chemical Co in 1968.  It was the best company in town. They paid well and had the latest tools. I noticed that they had the best secretarial staff and they were not always busy. They were happy to have IBM Selectric Typewriters and they were excited to have an IBM Mainframe Computer on site. This was years before we had PCs.  I was in Personnel in the Textile Division Staff and we were looking at job fit and enhancement. I noticed that the Managers these Secretaries worked for were extremely busy. I asked why we didn’t delegate more to these smart secretaries and was told that Monsanto over-hires because corporate taxes were 50% and they wanted to keep taxable profits low. They also used the money to invest in the latest technology and viewed their workforce as an asset. In the 1960s, all salary ranges fit on the salary range table. Most companies had Pension Plans. At Monsanto, the President was Grade 40. The salary grades were 1 to 40. The salary ranges were 10% between midpoints. Corporations were able to pay the President and Executives in company stock and bonuses. But the Top Rate for Income Tax was 70%.   

The Individual Income Tax Top Rate reached 94% during World War II, on income over $200,000. It dropped down to 91% in 1946 and remained there until the Kennedy tax cuts in 1962-64.

Democrats will attack Trump for lowering the US Corporate Tax Rate, but it will produce more revenue and Democrats hate that. Democrats feel more useful and relevant when times are bad and when times are good they are either quiet or unhappy. I recommend that they immigrate to Canada, so they can continue to be Left-wing Activists.

Norb Leahy, Dunwoody GA Tea Party Leader