tag:blogger.com,1999:blog-8152901575140311047.post4293296639491080807..comments2024-03-28T12:49:46.624-04:00Comments on Musings on Markets: The Tax Story in 2015: Myths, Misconceptions and Reality ChecksAswath Damodaranhttp://www.blogger.com/profile/12021594649672906878noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-8152901575140311047.post-50030006916491152332015-01-24T08:21:45.658-05:002015-01-24T08:21:45.658-05:00Your discussion of "effective tax rates per c...Your discussion of "effective tax rates per country" fails to mention a very important bit of information. That is, whether the "effective tax rate" refers to the effective tax rate on earnings within each country or whether the effective tax rate refers to the effective rate on global earnings. Pending your confirmation, I surmise the data is with respect to the latter.<br /><br />With respect to the US, this would explain, in large part, the wide divergence of "statutory" and "effective" rates. US multinational companies (another omitted fact---whether we are talking about publicly traded companies only and I assume this is so) enjoy lower effective rates simply because a significant portion of their earnings are not (currently) subject to the exorbitant US statutory rates. US multinational companies have a 28 percent effective rate largely because they have significant foreign earnings taxed at more reasonable rates and those earnings are trapped abroad due to the high cost of repatriating those earnings.<br /><br />It is, alas, very common for mainstream media to confuse effective *global" rates with effective *domestic* rates, or at least not to distinguish them, when talking about the tax rates suffered by businesses incorporated in the US. One expects a more nuanced discussion here.<br /><br />That said, the suggested reforms are largely appropriate.Anonymousnoreply@blogger.com