It's not that Americans just don't like paying taxes. They also really don't approve of the U.S. system as a whole, according to a recent survey.
An overwhelming majority of Americans say they don’t think the United States has the best tax system in the world, according to a new survey by Rasmussen Reports. Americans, Rasmussen says, “believe more strongly than ever that others do not pay their fair share.”
Only 12 percent of those surveyed say the U.S. has the world's greatest tax policies.
Such policies have a large influence on the size of the federal debt, which the country is currently trying to find the best way to reduce. Doing so certainly won't be easy. Just last month President Obama, while arguing Americans "instinctually understand" the need for reform, admitted imposing such large-scale changes to the tax system will be like "pulling teeth."
Obama recently focused attention on the corporate income tax. While the U.S. does have the highest marginal corporate tax rate in the developed world, many large corporations have tapped into a variety of techniques to get around the tax system. To take a recent example, a February report revealed that Facebook would likely use a quirk in the tax code to hold onto billions of dollars as it goes public. Other corporations have taken a more decidedly confrontational stance like when Apple announced that, due to issues with U.S. tax law, it would not move any of its foreign profits to the United States.
The consequence is that although the marginal tax rate on corporations is 35 percent, 280 Fortune 500 companies pay an average tax rate of 18.3 percent, the Citizens for Tax Justice reported in November. In monetary terms, that translates into $223 billion less than what is required under the statutory rate. And in recent years, 30 of America’s most profitable companies haven’t paid a penny in taxes.
But the White House's new tax plan, which lowers the statutory corporate tax rate, has also been criticized precisely because it does eliminate many of the loopholes and tax exemptions favored by corporations. The argument goes that such exceptions entice corporations to stay in the country.
Big businesses have also tried to lobby for additional tax benefits. To use Apple a second time, the iPhone maker teamed up with Google and others last year to push Congress for a tax holiday on their overseas profits, a move that would have cost the government $78.7 billion over the next ten years, Bloomberg reported in September.
Tax policies are expected to take center stage in Washington during the presidential election.