Yesterday, conservative pundit Glenn Beck and Wall Street Journal economics writer Stephen Moore, falsely claimed that America is the second-highest taxed country in the world:
MOORE: It`s a real problem. I think it`s one of the reasons, Glenn, the stock market is down. I think it`s one of the reasons the dollar has been falling. You and I have talked about that many times on this show.
It`s the root of all evil, the collapse of our currency. And it`s because we have gone from 20 years ago being one of the lowest taxed countries in the world. Under Barack Obama, we would be one of the highest taxed countries in the world.
BECK: Well, we already are number two, are we not?
MOORE: Well, we`d move to number one.
Beck and Moore have their numbers all wrong. The Tax Policy Center reports that America’s “tax burden is low,” and notes that the U.S. “raises significantly lower tax revenues as a percentage of gross domestic product than do most other countries in the OECD.”
Similarly, the tax burden of the average American family is 11.9 percent, far below Sweden’s 42.4 percent, Poland’s 42.1 percent, and France’s 41.7 percent.
Beck’s reference to “number two” likely describes America’s corporate tax rate. And while the United States does have the second highest corporate rate on paper, the effective tax rate is “in line with the rest of the world’s”:
The effective tax rate on equipment financed by equity is 24 percent, the same as the G-7 average. The rate on equipment financed by debt is minus 46 percent, meaning that the government actually subsidizes these investments rather than taxing them.
Perhaps Beck and Moore should consult Eric Toder, former director of the office of research for the Internal Revenue Service, who explained simply, “When you look at the overall tax burden, the U.S. is quite low.”