Corporate Tax

Arizona corporations would pay a mixed corporate tax price of 31.5% underneath the Biden Plan

The combined state and federal corporate tax rate in Arizona would hit 31.5 percent according to President Biden’s infrastructure plan, which is the 39th highest tax among the 50 states, according to a new study by the Tax Foundation.

U.S. corporations currently pay a corporate tax rate of 21 percent to the federal government, the Tax Foundation reported, but they also pay additional corporate taxes in 44 states and Washington, DC.The combined average paid by corporations is 25.8 percent, according to the Study.

Companies based in six states – Ohio, Nevada, South Dakota, Texas, Washington, and Wyoming – don’t pay state income tax, although they must pay their stake to the federal government, the Tax Foundation said.

Biden’s proposal would set the US combined corporate tax rate at 32.4 percent, which would be the highest rate under the Organization for Economic Co-operation and Development (OECD). The group includes nations in North America and Europe as well as Australia and New Zealand.

Such an increase in the US corporate tax rate would encourage companies to leave the US and cut workers’ wages and economic production, the Tax Foundation said.

However, U.S. companies have the option to deduct state-paid corporate taxes, which lowers their state corporate tax rate, the study found.

Combined corporate income tax under the Biden Plan

Status Combined state, national corporate tax rate under the Biden Plan Rank (from highest to lowest)
New Jersey 36.3% 1
Pennsylvania 35.2% 2
Iowa 35.1% 3 (tie)
Minnesota 35.1% 3 (tie)
Alaska 34.8% 5 (tie)
Illinois 34.8% 5 (tie)
California 34.4% 7 (tie)
Maine 34.4% 7 (tie)
Delaware 34.3% 9
Vermont 34.1% 10
Maryland 33.9% 11
Massachusetts 33.8% 12th
Wisconsin 33.7% 13
Nebraska 33.6% 14th
New Hampshire 33.5% 15 (tie)
Oregon 33.5% 15 (tie)
Connecticut 33.4% 17th
Idaho 33.0% 18 (tie)
Kansas 33.0% 18 (tie)
Rhode Island 33.0% 20th
Montana 32.9% 21
new York 32.7% 22 (tie)
Tennessee 32.7% 22 (tie)
Hawaii 32.6% 24 (tie)
Louisiana 32.6% 24 (tie)
Arkansas 32.5% 26
Michigan 32.3% 27 (tie)
Oklahoma 32.3% 27 (tie)
Virginia 32.3% 27 (tie)
West Virginia 32.3% 27 (tie)
New Mexico 32.2% 31
Georgia 32.1% 32
Indiana 31.8% 33
Alabama 31.7% 34
Kentucky 31.6% 35 (tie)
Mississippi 31.6% 35 (tie)
South carolina 31.6% 35 (tie)
Utah 31.6% 35 (tie)
Arizona 31.5% 39
Colorado 31.3% 40
Florida 31.2% 41
North Dakota 31.1% 42
Missouri 30.6% 43
North Carolina 29.8% 44
Nevada 28.0% 45 (tie)
Ohio 28.0% 45 (tie)
South Dakota 28.0% 45 (tie)
Texas 28.0% 45 (tie)
Washington 28.0% 45 (tie)
Wyoming 28.0% 45 (tie)

Source: Tax Foundation

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