One of the perennial debates in domestic tax policy is how U.S. corporate tax rates compare to international competitors. The bill's changes to the corporate rate structure alter the competitive position of U.S.-headquartered companies.
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Effective Rate Comparison
After the bill's changes, the U.S. combined federal and average state corporate effective tax rate for large multinationals rises from approximately 21.8% to approximately 24.1% — above the OECD average of 23.5%.
Core Takeaway
The OECD Pillar Two 15% global minimum tax changes this calculation significantly. Multinationals already subject to Pillar Two have less incentive to invert because the low-tax jurisdiction benefit is capped at 15%.