Necessary Roughness

Tax Cuts Across Europe
May 28th, 2007 at 5:29 pm

Bloomberg reports that EU countries are starting to compete for businesses by lowering corporate taxes:

Supporters of lower corporate taxes point to the success of Ireland, whose 12.5 percent rate, the lowest in the developed world, is down from 47 percent in 1988. That proved a magnet for such U.S.-based technology companies as Microsoft, Intel and Dell and helped Ireland’s economy grow more than three times the rate of the euro area in the past decade, while still running a budget surplus in nine of the 10 years.

Nielsen at Goldman Sachs is betting that lower corporate taxes, by making businesses more competitive, will help euro-zone economies grow at a faster rate without heating up inflation. An improved business climate has helped raise that rate, the so-called speed limit, to as much as 2.5 percent for the bloc’s economies, from 2 percent, he said.

12.5 percent of Microsoft, Intel, and Dell taxes is a lot more than 47 percent of zero. It’s another feather in the cap of Arthur Laffer.

Will the Democrats who consistently look to Europe as an ideal please adopt their tax strategies?

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This entry was posted on Monday, May 28th, 2007 at 5:29 pm and is filed under economics, international. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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3 Responses to “Tax Cuts Across Europe”

1. Lawrence Says:
   May 30th, 2007 at 8:54 am

   I really like this “Fair Tax” concept presented by John Linder and Neal Boortz:

   http://boortz.com/nuze/200508/08022005.html

   This taxation concept replaces our income tax with a consumption tax.

   This also eliminates the $11 - $12 Billion IRS budget that is siphoned out of our tax money just for the purpose of collecting our tax money. This would put a sizeable dent in the federal deficit estimated between $300 and $400 Billion.

   And it would leave more money in the hands of the tax payer for investing back into the economy, further strengthening the economy and increase consumption tax revenue accordingly. I say again, “increase”, tax revenue into the government coffers.

2. Dan Says:
   May 31st, 2007 at 1:04 pm

   I read the FairTax book. I like the plan in principle. I am a little worried about the “prebate” becoming a large entitlement program, but I wouldn’t let that stop me from endorsing it.

3. Lawrence Says:
   May 31st, 2007 at 4:17 pm

   We’re always going to have type of entitlement programs here in the U.S., whether we like it or not, I’m afraid.