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1. Shard Calculation

Query:

Response:

Calculated Shard: 25 (from laksa149)

2. Crawled Status Check

Query:

curl -X POST \
  'http://laksa025.int.ahrefs:8124/' \
  -H 'Content-Type: text/plain' \
  -H 'X-ClickHouse-Database: crawler3' \
  -H 'Authorization: Basic YXBpOg==' \
  -d 'SELECT getAhrefsURLFromUnparsed(src_unparsed) AS found_url, ifNull(toUnixTimestamp(download_stamp), 0) AS crawl_time, ifNull(toUnixTimestamp(props_url_first_seen), 0) AS first_indexed_time, download_http_code AS http_code, src_unparsed AS src_unparsed, src_root_hash AS src_root_hash, history_drop_reason AS history_drop_reason, meta_title AS meta_title, meta_descriptions AS meta_descriptions, attrs_boilerpipe_text AS attrs_boilerpipe_text, attrs_markdown AS attrs_markdown, attrs_readable_markdown AS attrs_readable_markdown, meta_canonical AS meta_canonical FROM crawler3.page_info_local FINAL PREWHERE (src_root_hash, src_unparsed) IN ((getAhrefsRootHashFromUnparsed(getAhrefsUnparsedNoserviceFromURL(\'https://taxfoundation.org/blog/trump-corporate-tax-cut/\')), getAhrefsUnparsedNoserviceFromURL(\'https://taxfoundation.org/blog/trump-corporate-tax-cut/\'))) FORMAT JSONEachRow'

Response:

{"found_url":"https:\/\/taxfoundation.org\/blog\/trump-corporate-tax-cut\/","crawl_time":1776294926,"first_indexed_time":1697654338,"http_code":200,"src_unparsed":"org,taxfoundation!\/blog\/trump-corporate-tax-cut\/ s443","src_root_hash":"7603385904904516025","history_drop_reason":null,"meta_title":"15% Trump Corporate Tax Rate: Details & Analysis","meta_descriptions":["Trump's proposed 15 percent corporate rate would be pro-growth, but it would not address the structural issues with the corporate tax base."],"attrs_boilerpipe_text":"Former President \nDonald Trump\n would like to\npush\nfor a reduction in the federal corporate\ntax\nA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities.\nrate from 21 percent to\n15 percen\nt if reelected.\nWhile a 15 percent corporate rate would boost growth, it would reduce federal tax revenue when\ndebt and deficits\nare already unsustainably high, potentially squeezing out other, more pro-growth tax changes that lawmakers will consider in 2025. If a lower rate is a priority, pairing it with reforms that broaden the \ntax base\n and remove\npenalties on investment\nwill be crucial.\nThe 2017 Tax Cuts and Jobs Act (\nTCJA\n) permanently reduced the US corporate tax rate from 35 percent to 21 percent as part of a \nlarger tax reform\n to move the US from a worldwide system of taxing profits regardless of where they were earned to a territorial system focused on profits earned in the US. The reforms boosted US competitiveness, lowering the combined corporate rate (accounting for the average state tax) from 38.9 percent in 2017—then the highest in the OECD—to 25.8 percent as of 2023. The US rate is now just under the OECD weighted average of 26.2 percent, though slightly higher than the OECD simple average of 23.5 percent.\nA lower\ncorporate income tax\nA corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax.\nrate would make the US a more attractive location for business investment, creating economic opportunities for American households and reducing incentives for businesses to move operations or profits overseas. The combined US rate would fall to 20.1 percent under Trump’s proposed 15 percent federal corporate income tax rate, just above \nEstonia\n’s combined rate of 20 percent. In the OECD, only \nHungary\n, \nIreland\n, and \nLuxembourg\n would have a significantly lower rate. Using Tax Foundation’s General Equilibrium Model, we estimate lowering the corporate income tax rate to 15 percent would increase long-run GDP by 0.4 percent, wages by 0.4 percent, and employment by about 93,000 full-time equivalent jobs. As economic research has consistently shown, corporate taxes are among the \nmost damaging\n types of revenue raisers, disincentivizing investment and \nreducing long-run wages\n for workers. Likewise, recent economic research has confirmed that the lower corporate income tax rate under the TCJA\nboosted investment\n,\nlifted wages\n, and\ngrew economic output\n.\nTable 1. Long-Run Economic Effects of Reducing the Corporate Tax Rate to 15 Percent\nSource: Tax Foundation General Equilibrium Model, July 2024.\nLowering the corporate rate to 15 percent would reduce federal revenue by $673 billion from 2025 to 2034 on a conventional basis. After factoring in positive economic feedback on federal revenues, the proposal would reduce revenue by about $460 billion over 10 years. In 2034, revenue would fall by $75 billion on a conventional basis but by a smaller $40 billion on a dynamic basis.\nThe revenue loss of moving to a 15 percent corporate rate would raise the debt-to-GDP ratio from 201.2 percent in 2065 to 202.6 percent on a dynamic basis, 1.4 percentage points higher than the baseline scenario.\nTable 2. Revenue Effects of Reducing the Corporate Rate to 15 Percent (Billions)\n2025\n2026\n2027\n2028\n2029\n2030\n2031\n2032\n2033\n2034\n2025-2034\nConventional\n-$78.0\n-$63.5\n-$66.6\n-$66.2\n-$61.6\n-$63.4\n-$63.4\n-$65.9\n-$69.4\n-$75.3\n-$673.1\nDynamic\n-$73.5\n-$54.3\n-$52.7\n-$48.6\n-$40.9\n-$39.6\n-$35.9\n-$36.6\n-$37.1\n-$40.3\n-$459.5\nSource: Tax Foundation General Equilibrium Model, July 2024.\nA lower corporate tax rate would boost incomes by increasing the after-tax return on investment for owners of corporate equities, which include a large swath of Americans \nacross all income levels\n, and by lifting worker wages as capital investment lifts productivity. On average, after-tax income would rise by 0.8 percent on a conventional basis and by 1.1 percent on a dynamic basis.\nTable 3. Distributional Effects of a 15 Percent Corporate Tax Rate (Percent Change in After-Tax Income)\nPercentile\nIncome Threshold at Beginning of Band\nConventional, Long-Run\nDynamic, Long-Run\n0% to 20%\n$0\n0.8%\n1.2%\n20% to 40%\n$13,900\n0.6%\n1.0%\n40% to 60%\n$29,800\n0.6%\n0.9%\n60% to 80%\n$55,400\n0.6%\n0.9%\n80% to 100%\n$96,200\n0.9%\n1.2%\n80% to 90%\n$96,200\n0.6%\n0.9%\n90% to 95%\n$137,000\n0.7%\n1.0%\n95% to 99%\n$191,500\n0.8%\n1.2%\n99% to 100%\n$434,800\n1.5%\n1.9%\nTotal\n0.8%\n1.1%\nNote: Income thresholds are in 2024 dollars and are determined by AGI with an adjustment for household size.\nSource: Tax Foundation General Equilibrium Model, July 2024.\nA 15 percent corporate rate would be pro-growth, but it would not address the structural issues with today’s corporate\ntax base\nThe tax base is the total amount of income, property, assets, consumption, transactions, or other economic activity subject to taxation by a tax authority. A narrow tax base is non-neutral and inefficient. A broad tax base reduces tax administration costs and allows more revenue to be raised at lower rates.\n.\nCurrently, businesses cannot fully recover their investment costs, as they must \namortize R&D expenses\n over five (or 15) years, and \nbonus depreciation\n is beginning to\nphase out\n. These investment penalties will blunt any positive effects of a corporate rate reduction, repeating a \nmistake\n from past tax reforms.\nIf policymakers prioritized improving the tax base by making expensing for short-lived assets and R&D expenses permanent, it would generate more growth and less revenue loss than a lower corporate tax rate: long-run GDP would rise by 0.5 percent and employment by 106,000 full-time equivalent jobs, while tax revenue would fall by $561 billion conventionally and $326 billion dynamically. The long-run cost would be minimal on a conventional basis, as expensing primarily changes the timing of deductions, and it would slightly raise revenue on a dynamic basis.\nLowering marginal tax rates on investment, as would occur under Trump’s proposed 15 percent corporate tax rate, would be pro-growth. However, lawmakers should also consider fundamentally improving and simplifying the business tax code via expensing and\ncorporate integration\n. Raising\ntariffs\nto pay for tax cuts, on the other hand, would be counterproductive, introducing more distortions and economic drag. Pro-growth tax reform can and should be achieved in a fiscally responsible manner, setting the federal government on a more stable and \nsustainable\n fiscal trajectory while boosting American competitiveness.\n\nStay informed on the tax policies impacting you.\nSubscribe to get insights from our trusted experts delivered straight to your inbox.\nSubscribe\nAbout the Authors\nGarrett Watson is Director of Policy Analysis at the Tax Foundation, where he conducts research on federal and state tax policy. His work has been featured in The Washington Post, The Atlantic, Politico, the Associated Press and other major outlets.\nErica York is Vice President of Federal Tax Policy with Tax Foundation’s Center for Federal Tax Policy. Her analysis has been featured in The Wall Street Journal, The Washington Post, Politico, and other national and international media outlets.","attrs_markdown":"[Skip to content](https:\/\/taxfoundation.org\/blog\/trump-corporate-tax-cut\/#main)\n\n- [US](https:\/\/taxfoundation.org\/)\n- [Europe](https:\/\/taxfoundation.org\/eu)\n- - [EN](https:\/\/taxfoundation.org\/blog\/trump-corporate-tax-cut\/ \"Switch to EN\")\n\n[![Tax Foundation](https:\/\/taxfoundation.org\/wp-content\/themes\/taxfoundation\/assets\/img\/tf-logo.svg)](https:\/\/taxfoundation.org\/ \"Tax Foundation\")\n\n- [Subscribe](https:\/\/taxfoundation.org\/tax-newsletter\/)\n- [Donate](https:\/\/taxfoundation.org\/donate)\n\n- [Research](https:\/\/taxfoundation.org\/research\/)\n  - - - [Research Areas](https:\/\/taxfoundation.org\/research\/)\n        - [Federal Tax](https:\/\/taxfoundation.org\/research\/federal-tax\/)\n        - [State Tax](https:\/\/taxfoundation.org\/research\/state-tax\/)\n        - [Global Tax](https:\/\/taxfoundation.org\/research\/global-tax\/)\n        - 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So it goes with the One Big Beautiful Bill, which will usher in a new golden age or send us down the tubes for good, depending on your sources.](https:\/\/taxfoundation.org\/wp-content\/uploads\/2025\/04\/AdobeStock_165971483-300x200.jpeg)](https:\/\/taxfoundation.org\/testimony\/testimony-the-impact-of-the-2025-reconciliation-laws\/)\n          \n          ### [Testimony: The Impact of the 2025 Reconciliation Law’s Tax Changes on Small Businesses and Lessons for Future Tax Reform](https:\/\/taxfoundation.org\/testimony\/testimony-the-impact-of-the-2025-reconciliation-laws\/)\n    - - #### Latest Op-ed\n        - [![Corporate Income Tax Payments, One Big Beautiful Bill Act (OBBBA)](https:\/\/taxfoundation.org\/wp-content\/uploads\/2026\/04\/AdobeStock_704526626-300x200.jpeg)](https:\/\/taxfoundation.org\/oped\/corporate-tax-payments-obbba\/)\n          \n          ### [Corporate Tax Payments Will Fall This Year. Here’s Why That’s Good News.](https:\/\/taxfoundation.org\/oped\/corporate-tax-payments-obbba\/)\n- [Education](https:\/\/taxfoundation.org\/taxedu\/)\n  - - - [Tax Terms Glossary](https:\/\/taxfoundation.org\/taxedu\/glossary\/)\n      - [Explainer Videos](https:\/\/taxfoundation.org\/taxedu\/videos\/)\n      - [The Short Form Blog](https:\/\/taxfoundation.org\/tags\/the-short-form\/)\n      - [Our Principles](https:\/\/taxfoundation.org\/taxedu\/principles\/)\n    - - [Primers](https:\/\/taxfoundation.org\/taxedu\/educational-resources\/)\n      - [Legislative Courses](https:\/\/taxfoundation.org\/taxedu\/legislative-courses\/)\n        - [Tax Foundation University](https:\/\/taxfoundation.org\/taxedu\/legislative-courses\/tax-foundation-university\/)\n        - [State Tax Policy Boot Camp](https:\/\/taxfoundation.org\/taxedu\/legislative-courses\/state-tax-policy-boot-camp\/)\n    - - [Featured Resources](https:\/\/taxfoundation.org\/taxedu\/educational-resources\/)\n        - [The Three Basic Tax Types](https:\/\/taxfoundation.org\/taxedu\/educational-resources\/primer-the-three-basic-tax-types\/)\n        - [Not All Taxes Are Created Equal](https:\/\/taxfoundation.org\/taxedu\/educational-resources\/primer-not-all-taxes-are-created-equal\/)\n        - [History of Taxes](https:\/\/taxfoundation.org\/taxedu\/educational-resources\/primer-history-of-taxes\/)\n        - [10 Common Tax Myths, Debunked](https:\/\/taxfoundation.org\/taxedu\/educational-resources\/primer-10-common-tax-myths-debunked\/)\n        - [A Carbon Tax, Explained](https:\/\/taxfoundation.org\/taxedu\/videos\/carbon-tax-explained\/)\n        - [Common Tax Questions, Answered](https:\/\/taxfoundation.org\/taxedu\/educational-resources\/primer-common-tax-questions-answered\/)\n    - - #### Featured Term\n        - [![Percentage of total personal consumption expenditures, base broadening the sales tax base](https:\/\/taxfoundation.org\/wp-content\/uploads\/2020\/04\/TF_UTSales_figure_5-300x193.png)](https:\/\/taxfoundation.org\/taxedu\/glossary\/base-broadening\/)\n          \n          ### [Base Broadening](https:\/\/taxfoundation.org\/taxedu\/glossary\/base-broadening\/)\n- [Events](https:\/\/taxfoundation.org\/events\/)\n- [About Us](https:\/\/taxfoundation.org\/about-us\/)\n  - - - [About Us](https:\/\/taxfoundation.org\/about-us\/)\n      - [Our Principles](https:\/\/taxfoundation.org\/taxedu\/principles\/)\n      - [Contact Us](https:\/\/taxfoundation.org\/about-us\/contact\/)\n    - - [Staff](https:\/\/taxfoundation.org\/about-us\/staff-and-board\/)\n        - [Meet Our Team](https:\/\/taxfoundation.org\/about-us\/staff-and-board\/)\n        - [Meet Our Experts](https:\/\/taxfoundation.org\/about-us\/staff-and-board\/experts\/)\n        - [Meet Our Board](https:\/\/taxfoundation.org\/about-us\/staff-and-board\/board\/)\n    - - [Careers](https:\/\/taxfoundation.org\/careers\/)\n        - [Job Openings](https:\/\/taxfoundation.org\/about-us\/careers\/#openings)\n        - [Internships](https:\/\/taxfoundation.org\/about-us\/careers\/internship\/)\n    - - [Support Our Work](https:\/\/taxfoundation.org\/donate\/)\n        - [Donate Today](https:\/\/taxfoundation.org\/donate\/)\n        - [Ways to Give](https:\/\/taxfoundation.org\/donate\/ways-to-give\/)\n        - [Donor FAQ](https:\/\/taxfoundation.org\/donate\/donor-faq\/)\n        - [Planned Giving](https:\/\/taxfoundation.org\/donate\/1937-legacy-society\/)\n\n[Home](https:\/\/taxfoundation.org\/) • [Blog](https:\/\/taxfoundation.org\/blog\/) • A Lower Corporate Tax Rate Can Be Part of Broader Tax Reform\n\n# A Lower Corporate Tax Rate Can Be Part of Broader Tax Reform\nJuly 17, 2024\n\nOctober 23, 2024\n\n4 min readBy: [Garrett Watson](https:\/\/taxfoundation.org\/about-us\/staff\/garrett-watson\/), [Erica York](https:\/\/taxfoundation.org\/about-us\/staff\/erica-york\/)\n\nFormer President [Donald Trump](https:\/\/taxfoundation.org\/research\/federal-tax\/trump-administration-tax-proposals\/) would like to [push](https:\/\/www.washingtonpost.com\/business\/2023\/09\/11\/trump-tax-cuts-2024\/) for a reduction in the federal corporate [tax](https:\/\/taxfoundation.org\/taxedu\/glossary\/tax\/) A tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. rate from 21 percent to [15 percen](https:\/\/www.bloomberg.com\/news\/articles\/2024-07-16\/trump-interview-highlights-plans-for-taxes-tariffs-taiwan-and-more?embedded-checkout=true)t if reelected.\n\nWhile a 15 percent corporate rate would boost growth, it would reduce federal tax revenue when [debt and deficits](https:\/\/taxfoundation.org\/tags\/debt-and-interest-rates\/) are already unsustainably high, potentially squeezing out other, more pro-growth tax changes that lawmakers will consider in 2025. If a lower rate is a priority, pairing it with reforms that broaden the [tax base](https:\/\/taxfoundation.org\/taxedu\/glossary\/tax-base\/) and remove [penalties on investment](https:\/\/taxfoundation.org\/research\/all\/federal\/tax-cuts-jobs-act-business-tax-increases\/) will be crucial.\n\nThe 2017 Tax Cuts and Jobs Act ([TCJA](https:\/\/taxfoundation.org\/taxedu\/glossary\/tax-cuts-and-jobs-act\/)) permanently reduced the US corporate tax rate from 35 percent to 21 percent as part of a [larger tax reform](https:\/\/taxfoundation.org\/research\/all\/federal\/treatment-foreign-profits-tax-cuts-jobs-act\/) to move the US from a worldwide system of taxing profits regardless of where they were earned to a territorial system focused on profits earned in the US. The reforms boosted US competitiveness, lowering the combined corporate rate (accounting for the average state tax) from 38.9 percent in 2017—then the highest in the OECD—to 25.8 percent as of 2023. The US rate is now just under the OECD weighted average of 26.2 percent, though slightly higher than the OECD simple average of 23.5 percent.\n\nA lower [corporate income tax](https:\/\/taxfoundation.org\/taxedu\/glossary\/corporate-income-tax-cit\/) A corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. rate would make the US a more attractive location for business investment, creating economic opportunities for American households and reducing incentives for businesses to move operations or profits overseas. The combined US rate would fall to 20.1 percent under Trump’s proposed 15 percent federal corporate income tax rate, just above [Estonia](https:\/\/taxfoundation.org\/location\/estonia\/)’s combined rate of 20 percent. In the OECD, only [Hungary](https:\/\/taxfoundation.org\/location\/hungary\/), [Ireland](https:\/\/taxfoundation.org\/location\/ireland\/), and [Luxembourg](https:\/\/taxfoundation.org\/location\/luxembourg\/) would have a significantly lower rate. Using Tax Foundation’s General Equilibrium Model, we estimate lowering the corporate income tax rate to 15 percent would increase long-run GDP by 0.4 percent, wages by 0.4 percent, and employment by about 93,000 full-time equivalent jobs. As economic research has consistently shown, corporate taxes are among the [most damaging](https:\/\/taxfoundation.org\/blog\/corporate-income-tax-most-harmful-growth-and-wages\/) types of revenue raisers, disincentivizing investment and [reducing long-run wages](https:\/\/taxfoundation.org\/blog\/who-bears-burden-corporate-tax\/) for workers. Likewise, recent economic research has confirmed that the lower corporate income tax rate under the TCJA [boosted investment](https:\/\/www.nber.org\/system\/files\/working_papers\/w32672\/w32672.pdf), [lifted wages](https:\/\/www.nber.org\/system\/files\/working_papers\/w32672\/w32672.pdf), and [grew economic output](https:\/\/www.nber.org\/system\/files\/working_papers\/w32672\/w32672.pdf).\n\n##\n#### Table 1. Long-Run Economic Effects of Reducing the Corporate Tax Rate to 15 Percent\n|   |   |\n|---|---|\n| Gross Domestic Product (GDP) | \\+0.4% |\n| Gross National Product (GNP) | \\+0.4% |\n| Capital Stock | \\+0.8% |\n| Wages | \\+0.4% |\n| Full-Time Equivalent Jobs | \\+93,000 |\n\nSource: Tax Foundation General Equilibrium Model, July 2024.\n\nLowering the corporate rate to 15 percent would reduce federal revenue by \\$673 billion from 2025 to 2034 on a conventional basis. After factoring in positive economic feedback on federal revenues, the proposal would reduce revenue by about \\$460 billion over 10 years. In 2034, revenue would fall by \\$75 billion on a conventional basis but by a smaller \\$40 billion on a dynamic basis.\n\nThe revenue loss of moving to a 15 percent corporate rate would raise the debt-to-GDP ratio from 201.2 percent in 2065 to 202.6 percent on a dynamic basis, 1.4 percentage points higher than the baseline scenario.\n\n##\n#### Table 2. Revenue Effects of Reducing the Corporate Rate to 15 Percent (Billions)\n|   |   |   |   |   |   |   |   |   |   |   |   |\n|---|---|---|---|---|---|---|---|---|---|---|---|\n|   | 2025 | 2026 | 2027 | 2028 | 2029 | 2030 | 2031 | 2032 | 2033 | 2034 | 2025-2034 |\n| Conventional | \\-\\$78.0 | \\-\\$63.5 | \\-\\$66.6 | \\-\\$66.2 | \\-\\$61.6 | \\-\\$63.4 | \\-\\$63.4 | \\-\\$65.9 | \\-\\$69.4 | \\-\\$75.3 | **\\-\\$673.1** |\n| Dynamic | \\-\\$73.5 | \\-\\$54.3 | \\-\\$52.7 | \\-\\$48.6 | \\-\\$40.9 | \\-\\$39.6 | \\-\\$35.9 | \\-\\$36.6 | \\-\\$37.1 | \\-\\$40.3 | **\\-\\$459.5** |\n\nSource: Tax Foundation General Equilibrium Model, July 2024.\n\nA lower corporate tax rate would boost incomes by increasing the after-tax return on investment for owners of corporate equities, which include a large swath of Americans [across all income levels](https:\/\/taxfoundation.org\/research\/all\/federal\/retirement-accounts-taxation\/), and by lifting worker wages as capital investment lifts productivity. On average, after-tax income would rise by 0.8 percent on a conventional basis and by 1.1 percent on a dynamic basis.\n\n##\n#### Table 3. Distributional Effects of a 15 Percent Corporate Tax Rate (Percent Change in After-Tax Income)\n| Percentile | Income Threshold at Beginning of Band | Conventional, Long-Run | Dynamic, Long-Run |\n|---|---|---|---|\n| 0% to 20% | \\$0 | 0\\.8% | 1\\.2% |\n| 20% to 40% | \\$13,900 | 0\\.6% | 1\\.0% |\n| 40% to 60% | \\$29,800 | 0\\.6% | 0\\.9% |\n| 60% to 80% | \\$55,400 | 0\\.6% | 0\\.9% |\n| 80% to 100% | \\$96,200 | 0\\.9% | 1\\.2% |\n| 80% to 90% | \\$96,200 | 0\\.6% | 0\\.9% |\n| 90% to 95% | \\$137,000 | 0\\.7% | 1\\.0% |\n| 95% to 99% | \\$191,500 | 0\\.8% | 1\\.2% |\n| 99% to 100% | \\$434,800 | 1\\.5% | 1\\.9% |\n| **Total** |   | **0\\.8%** | **1\\.1%** |\n\nNote: Income thresholds are in 2024 dollars and are determined by AGI with an adjustment for household size.  \n   \n Source: Tax Foundation General Equilibrium Model, July 2024.\n\nA 15 percent corporate rate would be pro-growth, but it would not address the structural issues with today’s corporate [tax base](https:\/\/taxfoundation.org\/taxedu\/glossary\/tax-base\/) The tax base is the total amount of income, property, assets, consumption, transactions, or other economic activity subject to taxation by a tax authority. A narrow tax base is non-neutral and inefficient. A broad tax base reduces tax administration costs and allows more revenue to be raised at lower rates. . Currently, businesses cannot fully recover their investment costs, as they must [amortize R\\&D expenses](https:\/\/taxfoundation.org\/blog\/rd-amortization-impact\/) over five (or 15) years, and [bonus depreciation](https:\/\/taxfoundation.org\/taxedu\/glossary\/bonus-depreciation\/) is beginning to [phase out](https:\/\/taxfoundation.org\/blog\/us-competitiveness-taxes\/). These investment penalties will blunt any positive effects of a corporate rate reduction, repeating a [mistake](https:\/\/www.ocregister.com\/2023\/09\/20\/reagans-legacy-on-taxes-what-to-take-and-what-to-leave\/) from past tax reforms.\n\nIf policymakers prioritized improving the tax base by making expensing for short-lived assets and R\\&D expenses permanent, it would generate more growth and less revenue loss than a lower corporate tax rate: long-run GDP would rise by 0.5 percent and employment by 106,000 full-time equivalent jobs, while tax revenue would fall by \\$561 billion conventionally and \\$326 billion dynamically. The long-run cost would be minimal on a conventional basis, as expensing primarily changes the timing of deductions, and it would slightly raise revenue on a dynamic basis.\n\nLowering marginal tax rates on investment, as would occur under Trump’s proposed 15 percent corporate tax rate, would be pro-growth. However, lawmakers should also consider fundamentally improving and simplifying the business tax code via expensing and [corporate integration](https:\/\/taxfoundation.org\/research\/all\/federal\/growth-opportunity-us-tax-reform-plan\/). Raising [tariffs](https:\/\/taxfoundation.org\/blog\/trump-tax-plan-tariffs-analysis\/) to pay for tax cuts, on the other hand, would be counterproductive, introducing more distortions and economic drag. Pro-growth tax reform can and should be achieved in a fiscally responsible manner, setting the federal government on a more stable and [sustainable](https:\/\/taxfoundation.org\/research\/all\/federal\/us-debt-deficits-federal-budget-spending-taxes\/) fiscal trajectory while boosting American competitiveness.\n\n\n\n## Stay informed on the tax policies impacting you.\nSubscribe to get insights from our trusted experts delivered straight to your inbox.\n\n[Subscribe](https:\/\/taxfoundation.org\/tax-newsletter)\n\nShare this article\n\nTwitter\n\nLinkedIn\n\nFacebook\n\nEmail\n\n## About the Authors\n[![Garrett Watson Tax Foundation](https:\/\/taxfoundation.org\/wp-content\/uploads\/2023\/08\/GWattson-300x300.png)](https:\/\/taxfoundation.org\/wp-content\/uploads\/2023\/08\/GWattson.png)\n\nExpert\n\n### [Garrett Watson](https:\/\/taxfoundation.org\/about-us\/staff\/garrett-watson\/)\nDirector of Policy Analysis\n\nGarrett Watson is Director of Policy Analysis at the Tax Foundation, where he conducts research on federal and state tax policy. His work has been featured in The Washington Post, The Atlantic, Politico, the Associated Press and other major outlets.\n\n[![Erica York Tax Foundation](https:\/\/taxfoundation.org\/wp-content\/uploads\/2023\/08\/eYork-300x300.png)](https:\/\/taxfoundation.org\/wp-content\/uploads\/2023\/08\/eYork.png)\n\nExpert\n\n### [Erica York](https:\/\/taxfoundation.org\/about-us\/staff\/erica-york\/)\nVice President of Federal Tax Policy\n\nErica York is Vice President of Federal Tax Policy with Tax Foundation’s Center for Federal Tax Policy. Her analysis has been featured in The Wall Street Journal, The Washington Post, Politico, and other national and international media outlets.\n\n## All Related Articles\n- Blog\n  \n  October 27, 2025\n  ### [What to Expect from the New OBBBA Expensing for Manufacturing Structures](https:\/\/taxfoundation.org\/blog\/obbba-expensing-manufacturing-structures\/)\n  Expensing for manufacturing structures is a significant step forward for the tax treatment of structures, but it could be improved in several ways.\n  \n  7 min read\n- [Research](https:\/\/taxfoundation.org\/all-research-data\/?post_types=all-research#results)\n  \n  September 9, 2025\n  \n  October 9, 2025\n  ### [One Big Beautiful Bill Act Makes the Individual Income Tax More Complex](https:\/\/taxfoundation.org\/research\/all\/federal\/obbba-income-tax-complexity-tax-breaks\/)\n  While the OBBBA brings some stability by making many of the TCJA’s reforms permanent, it generally fails to reform the tax code’s accumulating complexity.\n  \n  31 min read\n- Blog\n  \n  July 22, 2025\n  \n  July 30, 2025\n  ### [The OBBBA Gets Expensing Right. States Should Follow Suit.](https:\/\/taxfoundation.org\/blog\/one-big-beautiful-bill-expensing-state-tax-conformity\/)\n  However states choose to respond to other tax provisions of the One Big Beautiful Bill Act, they should conform to the pro-growth provisions, which represent a marked improvement in the corporate tax code.\n  \n  12 min read\n\n## Topics\n- [Business Taxes](https:\/\/taxfoundation.org\/topics\/business-taxes\/)\n- [Corporate Income Taxes](https:\/\/taxfoundation.org\/topics\/corporate-income-taxes\/)\n- [Cost Recovery](https:\/\/taxfoundation.org\/topics\/cost-recovery\/)\n- [Economic and Tax Modeling](https:\/\/taxfoundation.org\/topics\/economic-and-tax-modeling\/)\n- [Modeling Tax Proposals](https:\/\/taxfoundation.org\/topics\/modeling-tax-proposals\/)\n\n## Tags\n- **Tags:**\n- [2024 Election](https:\/\/taxfoundation.org\/tags\/2024-election\/)\n- [Debt and Interest Rates](https:\/\/taxfoundation.org\/tags\/debt-and-interest-rates\/)\n- [Donald Trump](https:\/\/taxfoundation.org\/tags\/donald-trump\/)\n- [Research and Development (R\\&D)](https:\/\/taxfoundation.org\/tags\/research-and-development-rd\/)\n- [Tax Cuts and Jobs Act (TCJA)](https:\/\/taxfoundation.org\/tags\/tax-cuts-and-jobs-act-tcja\/)\n\n## Locations\n- **Locations:**\n- [United States](https:\/\/taxfoundation.org\/location\/united-states\/)\n\n## Authors\n- [![Garrett Watson Tax Foundation](https:\/\/taxfoundation.org\/wp-content\/uploads\/2023\/08\/GWattson-300x300.png)](https:\/\/taxfoundation.org\/wp-content\/uploads\/2023\/08\/GWattson.png)\n  \n  Expert\n  \n  ### [Garrett Watson](https:\/\/taxfoundation.org\/about-us\/staff\/garrett-watson\/)\n  Director of Policy Analysis\n- [![Erica York Tax Foundation](https:\/\/taxfoundation.org\/wp-content\/uploads\/2023\/08\/eYork-300x300.png)](https:\/\/taxfoundation.org\/wp-content\/uploads\/2023\/08\/eYork.png)\n  \n  Expert\n  \n  ### [Erica York](https:\/\/taxfoundation.org\/about-us\/staff\/erica-york\/)\n  Vice President of Federal Tax Policy\n\n[![Tax Foundation](https:\/\/taxfoundation.org\/wp-content\/themes\/taxfoundation\/assets\/img\/tf-logo.svg)](https:\/\/taxfoundation.org\/ \"Tax Foundation\")\n\nStay informed on the tax policies impacting you.\n\n[Subscribe](https:\/\/taxfoundation.org\/tax-newsletter\/)\n\n[About](https:\/\/taxfoundation.org\/about-us\/)  \nSince 1937, our principled research, insightful analysis, and engaged experts have informed smarter tax policy in the U.S. and internationally. For over 80 years, our mission has remained the same: to improve lives through tax policies that lead to greater economic growth and opportunity.\n\n[Donate](https:\/\/taxfoundation.org\/donate\/)  \nAs a nonprofit, we depend on the generosity of individuals like you.\n\n- [Careers](https:\/\/taxfoundation.org\/about-us\/careers\/)\n- [Contact Us](https:\/\/taxfoundation.org\/about-us\/contact\/)\n\n1325 G St NW, Suite 950  \n Washington, DC 20005\n\n- Copyright Tax Foundation 2026\n- [Copyright Notice](https:\/\/taxfoundation.org\/copyright-notice)\n- [Privacy Policy](https:\/\/taxfoundation.org\/privacy-policy)","attrs_readable_markdown":"Former President [Donald Trump](https:\/\/taxfoundation.org\/research\/federal-tax\/trump-administration-tax-proposals\/) would like to [push](https:\/\/www.washingtonpost.com\/business\/2023\/09\/11\/trump-tax-cuts-2024\/) for a reduction in the federal corporate [tax](https:\/\/taxfoundation.org\/taxedu\/glossary\/tax\/) A tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. rate from 21 percent to [15 percen](https:\/\/www.bloomberg.com\/news\/articles\/2024-07-16\/trump-interview-highlights-plans-for-taxes-tariffs-taiwan-and-more?embedded-checkout=true)t if reelected.\n\nWhile a 15 percent corporate rate would boost growth, it would reduce federal tax revenue when [debt and deficits](https:\/\/taxfoundation.org\/tags\/debt-and-interest-rates\/) are already unsustainably high, potentially squeezing out other, more pro-growth tax changes that lawmakers will consider in 2025. If a lower rate is a priority, pairing it with reforms that broaden the [tax base](https:\/\/taxfoundation.org\/taxedu\/glossary\/tax-base\/) and remove [penalties on investment](https:\/\/taxfoundation.org\/research\/all\/federal\/tax-cuts-jobs-act-business-tax-increases\/) will be crucial.\n\nThe 2017 Tax Cuts and Jobs Act ([TCJA](https:\/\/taxfoundation.org\/taxedu\/glossary\/tax-cuts-and-jobs-act\/)) permanently reduced the US corporate tax rate from 35 percent to 21 percent as part of a [larger tax reform](https:\/\/taxfoundation.org\/research\/all\/federal\/treatment-foreign-profits-tax-cuts-jobs-act\/) to move the US from a worldwide system of taxing profits regardless of where they were earned to a territorial system focused on profits earned in the US. The reforms boosted US competitiveness, lowering the combined corporate rate (accounting for the average state tax) from 38.9 percent in 2017—then the highest in the OECD—to 25.8 percent as of 2023. The US rate is now just under the OECD weighted average of 26.2 percent, though slightly higher than the OECD simple average of 23.5 percent.\n\nA lower [corporate income tax](https:\/\/taxfoundation.org\/taxedu\/glossary\/corporate-income-tax-cit\/) A corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. rate would make the US a more attractive location for business investment, creating economic opportunities for American households and reducing incentives for businesses to move operations or profits overseas. The combined US rate would fall to 20.1 percent under Trump’s proposed 15 percent federal corporate income tax rate, just above [Estonia](https:\/\/taxfoundation.org\/location\/estonia\/)’s combined rate of 20 percent. In the OECD, only [Hungary](https:\/\/taxfoundation.org\/location\/hungary\/), [Ireland](https:\/\/taxfoundation.org\/location\/ireland\/), and [Luxembourg](https:\/\/taxfoundation.org\/location\/luxembourg\/) would have a significantly lower rate. Using Tax Foundation’s General Equilibrium Model, we estimate lowering the corporate income tax rate to 15 percent would increase long-run GDP by 0.4 percent, wages by 0.4 percent, and employment by about 93,000 full-time equivalent jobs. As economic research has consistently shown, corporate taxes are among the [most damaging](https:\/\/taxfoundation.org\/blog\/corporate-income-tax-most-harmful-growth-and-wages\/) types of revenue raisers, disincentivizing investment and [reducing long-run wages](https:\/\/taxfoundation.org\/blog\/who-bears-burden-corporate-tax\/) for workers. Likewise, recent economic research has confirmed that the lower corporate income tax rate under the TCJA [boosted investment](https:\/\/www.nber.org\/system\/files\/working_papers\/w32672\/w32672.pdf), [lifted wages](https:\/\/www.nber.org\/system\/files\/working_papers\/w32672\/w32672.pdf), and [grew economic output](https:\/\/www.nber.org\/system\/files\/working_papers\/w32672\/w32672.pdf).\n\n#### Table 1. Long-Run Economic Effects of Reducing the Corporate Tax Rate to 15 Percent\nSource: Tax Foundation General Equilibrium Model, July 2024.\n\nLowering the corporate rate to 15 percent would reduce federal revenue by \\$673 billion from 2025 to 2034 on a conventional basis. After factoring in positive economic feedback on federal revenues, the proposal would reduce revenue by about \\$460 billion over 10 years. In 2034, revenue would fall by \\$75 billion on a conventional basis but by a smaller \\$40 billion on a dynamic basis.\n\nThe revenue loss of moving to a 15 percent corporate rate would raise the debt-to-GDP ratio from 201.2 percent in 2065 to 202.6 percent on a dynamic basis, 1.4 percentage points higher than the baseline scenario.\n\n#### Table 2. Revenue Effects of Reducing the Corporate Rate to 15 Percent (Billions)\n|   |   |   |   |   |   |   |   |   |   |   |   |\n|---|---|---|---|---|---|---|---|---|---|---|---|\n|   | 2025 | 2026 | 2027 | 2028 | 2029 | 2030 | 2031 | 2032 | 2033 | 2034 | 2025-2034 |\n| Conventional | \\-\\$78.0 | \\-\\$63.5 | \\-\\$66.6 | \\-\\$66.2 | \\-\\$61.6 | \\-\\$63.4 | \\-\\$63.4 | \\-\\$65.9 | \\-\\$69.4 | \\-\\$75.3 | **\\-\\$673.1** |\n| Dynamic | \\-\\$73.5 | \\-\\$54.3 | \\-\\$52.7 | \\-\\$48.6 | \\-\\$40.9 | \\-\\$39.6 | \\-\\$35.9 | \\-\\$36.6 | \\-\\$37.1 | \\-\\$40.3 | **\\-\\$459.5** |\n\nSource: Tax Foundation General Equilibrium Model, July 2024.\n\nA lower corporate tax rate would boost incomes by increasing the after-tax return on investment for owners of corporate equities, which include a large swath of Americans [across all income levels](https:\/\/taxfoundation.org\/research\/all\/federal\/retirement-accounts-taxation\/), and by lifting worker wages as capital investment lifts productivity. On average, after-tax income would rise by 0.8 percent on a conventional basis and by 1.1 percent on a dynamic basis.\n\n#### Table 3. Distributional Effects of a 15 Percent Corporate Tax Rate (Percent Change in After-Tax Income)\n| Percentile | Income Threshold at Beginning of Band | Conventional, Long-Run | Dynamic, Long-Run |\n|---|---|---|---|\n| 0% to 20% | \\$0 | 0\\.8% | 1\\.2% |\n| 20% to 40% | \\$13,900 | 0\\.6% | 1\\.0% |\n| 40% to 60% | \\$29,800 | 0\\.6% | 0\\.9% |\n| 60% to 80% | \\$55,400 | 0\\.6% | 0\\.9% |\n| 80% to 100% | \\$96,200 | 0\\.9% | 1\\.2% |\n| 80% to 90% | \\$96,200 | 0\\.6% | 0\\.9% |\n| 90% to 95% | \\$137,000 | 0\\.7% | 1\\.0% |\n| 95% to 99% | \\$191,500 | 0\\.8% | 1\\.2% |\n| 99% to 100% | \\$434,800 | 1\\.5% | 1\\.9% |\n| **Total** |   | **0\\.8%** | **1\\.1%** |\n\nNote: Income thresholds are in 2024 dollars and are determined by AGI with an adjustment for household size. Source: Tax Foundation General Equilibrium Model, July 2024.\n\nA 15 percent corporate rate would be pro-growth, but it would not address the structural issues with today’s corporate [tax base](https:\/\/taxfoundation.org\/taxedu\/glossary\/tax-base\/) The tax base is the total amount of income, property, assets, consumption, transactions, or other economic activity subject to taxation by a tax authority. A narrow tax base is non-neutral and inefficient. A broad tax base reduces tax administration costs and allows more revenue to be raised at lower rates. . Currently, businesses cannot fully recover their investment costs, as they must [amortize R\\&D expenses](https:\/\/taxfoundation.org\/blog\/rd-amortization-impact\/) over five (or 15) years, and [bonus depreciation](https:\/\/taxfoundation.org\/taxedu\/glossary\/bonus-depreciation\/) is beginning to [phase out](https:\/\/taxfoundation.org\/blog\/us-competitiveness-taxes\/). These investment penalties will blunt any positive effects of a corporate rate reduction, repeating a [mistake](https:\/\/www.ocregister.com\/2023\/09\/20\/reagans-legacy-on-taxes-what-to-take-and-what-to-leave\/) from past tax reforms.\n\nIf policymakers prioritized improving the tax base by making expensing for short-lived assets and R\\&D expenses permanent, it would generate more growth and less revenue loss than a lower corporate tax rate: long-run GDP would rise by 0.5 percent and employment by 106,000 full-time equivalent jobs, while tax revenue would fall by \\$561 billion conventionally and \\$326 billion dynamically. The long-run cost would be minimal on a conventional basis, as expensing primarily changes the timing of deductions, and it would slightly raise revenue on a dynamic basis.\n\nLowering marginal tax rates on investment, as would occur under Trump’s proposed 15 percent corporate tax rate, would be pro-growth. However, lawmakers should also consider fundamentally improving and simplifying the business tax code via expensing and [corporate integration](https:\/\/taxfoundation.org\/research\/all\/federal\/growth-opportunity-us-tax-reform-plan\/). Raising [tariffs](https:\/\/taxfoundation.org\/blog\/trump-tax-plan-tariffs-analysis\/) to pay for tax cuts, on the other hand, would be counterproductive, introducing more distortions and economic drag. Pro-growth tax reform can and should be achieved in a fiscally responsible manner, setting the federal government on a more stable and [sustainable](https:\/\/taxfoundation.org\/research\/all\/federal\/us-debt-deficits-federal-budget-spending-taxes\/) fiscal trajectory while boosting American competitiveness.\n\n\n\n## Stay informed on the tax policies impacting you.\nSubscribe to get insights from our trusted experts delivered straight to your inbox.\n\n[Subscribe](https:\/\/taxfoundation.org\/tax-newsletter)\n\n## About the Authors\nGarrett Watson is Director of Policy Analysis at the Tax Foundation, where he conducts research on federal and state tax policy. His work has been featured in The Washington Post, The Atlantic, Politico, the Associated Press and other major outlets.\n\nErica York is Vice President of Federal Tax Policy with Tax Foundation’s Center for Federal Tax Policy. Her analysis has been featured in The Wall Street Journal, The Washington Post, Politico, and other national and international media outlets.","meta_canonical":null}

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Boilerpipe Text	Former President Donald Trump would like to push for a reduction in the federal corporate tax A tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. rate from 21 percent to 15 percen t if reelected. While a 15 percent corporate rate would boost growth, it would reduce federal tax revenue when debt and deficits are already unsustainably high, potentially squeezing out other, more pro-growth tax changes that lawmakers will consider in 2025. If a lower rate is a priority, pairing it with reforms that broaden the tax base and remove penalties on investment will be crucial. The 2017 Tax Cuts and Jobs Act ( TCJA ) permanently reduced the US corporate tax rate from 35 percent to 21 percent as part of a larger tax reform to move the US from a worldwide system of taxing profits regardless of where they were earned to a territorial system focused on profits earned in the US. The reforms boosted US competitiveness, lowering the combined corporate rate (accounting for the average state tax) from 38.9 percent in 2017—then the highest in the OECD—to 25.8 percent as of 2023. The US rate is now just under the OECD weighted average of 26.2 percent, though slightly higher than the OECD simple average of 23.5 percent. A lower corporate income tax A corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. rate would make the US a more attractive location for business investment, creating economic opportunities for American households and reducing incentives for businesses to move operations or profits overseas. The combined US rate would fall to 20.1 percent under Trump’s proposed 15 percent federal corporate income tax rate, just above Estonia ’s combined rate of 20 percent. In the OECD, only Hungary , Ireland , and Luxembourg would have a significantly lower rate. Using Tax Foundation’s General Equilibrium Model, we estimate lowering the corporate income tax rate to 15 percent would increase long-run GDP by 0.4 percent, wages by 0.4 percent, and employment by about 93,000 full-time equivalent jobs. As economic research has consistently shown, corporate taxes are among the most damaging types of revenue raisers, disincentivizing investment and reducing long-run wages for workers. Likewise, recent economic research has confirmed that the lower corporate income tax rate under the TCJA boosted investment , lifted wages , and grew economic output . Table 1. Long-Run Economic Effects of Reducing the Corporate Tax Rate to 15 Percent Source: Tax Foundation General Equilibrium Model, July 2024. Lowering the corporate rate to 15 percent would reduce federal revenue by $673 billion from 2025 to 2034 on a conventional basis. After factoring in positive economic feedback on federal revenues, the proposal would reduce revenue by about $460 billion over 10 years. In 2034, revenue would fall by $75 billion on a conventional basis but by a smaller $40 billion on a dynamic basis. The revenue loss of moving to a 15 percent corporate rate would raise the debt-to-GDP ratio from 201.2 percent in 2065 to 202.6 percent on a dynamic basis, 1.4 percentage points higher than the baseline scenario. Table 2. Revenue Effects of Reducing the Corporate Rate to 15 Percent (Billions) 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2025-2034 Conventional -$78.0 -$63.5 -$66.6 -$66.2 -$61.6 -$63.4 -$63.4 -$65.9 -$69.4 -$75.3 -$673.1 Dynamic -$73.5 -$54.3 -$52.7 -$48.6 -$40.9 -$39.6 -$35.9 -$36.6 -$37.1 -$40.3 -$459.5 Source: Tax Foundation General Equilibrium Model, July 2024. A lower corporate tax rate would boost incomes by increasing the after-tax return on investment for owners of corporate equities, which include a large swath of Americans across all income levels , and by lifting worker wages as capital investment lifts productivity. On average, after-tax income would rise by 0.8 percent on a conventional basis and by 1.1 percent on a dynamic basis. Table 3. Distributional Effects of a 15 Percent Corporate Tax Rate (Percent Change in After-Tax Income) Percentile Income Threshold at Beginning of Band Conventional, Long-Run Dynamic, Long-Run 0% to 20% $0 0.8% 1.2% 20% to 40% $13,900 0.6% 1.0% 40% to 60% $29,800 0.6% 0.9% 60% to 80% $55,400 0.6% 0.9% 80% to 100% $96,200 0.9% 1.2% 80% to 90% $96,200 0.6% 0.9% 90% to 95% $137,000 0.7% 1.0% 95% to 99% $191,500 0.8% 1.2% 99% to 100% $434,800 1.5% 1.9% Total 0.8% 1.1% Note: Income thresholds are in 2024 dollars and are determined by AGI with an adjustment for household size. Source: Tax Foundation General Equilibrium Model, July 2024. A 15 percent corporate rate would be pro-growth, but it would not address the structural issues with today’s corporate tax base The tax base is the total amount of income, property, assets, consumption, transactions, or other economic activity subject to taxation by a tax authority. A narrow tax base is non-neutral and inefficient. A broad tax base reduces tax administration costs and allows more revenue to be raised at lower rates. . Currently, businesses cannot fully recover their investment costs, as they must amortize R&D expenses over five (or 15) years, and bonus depreciation is beginning to phase out . These investment penalties will blunt any positive effects of a corporate rate reduction, repeating a mistake from past tax reforms. If policymakers prioritized improving the tax base by making expensing for short-lived assets and R&D expenses permanent, it would generate more growth and less revenue loss than a lower corporate tax rate: long-run GDP would rise by 0.5 percent and employment by 106,000 full-time equivalent jobs, while tax revenue would fall by $561 billion conventionally and $326 billion dynamically. The long-run cost would be minimal on a conventional basis, as expensing primarily changes the timing of deductions, and it would slightly raise revenue on a dynamic basis. Lowering marginal tax rates on investment, as would occur under Trump’s proposed 15 percent corporate tax rate, would be pro-growth. However, lawmakers should also consider fundamentally improving and simplifying the business tax code via expensing and corporate integration . Raising tariffs to pay for tax cuts, on the other hand, would be counterproductive, introducing more distortions and economic drag. Pro-growth tax reform can and should be achieved in a fiscally responsible manner, setting the federal government on a more stable and sustainable fiscal trajectory while boosting American competitiveness. Stay informed on the tax policies impacting you. Subscribe to get insights from our trusted experts delivered straight to your inbox. Subscribe About the Authors Garrett Watson is Director of Policy Analysis at the Tax Foundation, where he conducts research on federal and state tax policy. His work has been featured in The Washington Post, The Atlantic, Politico, the Associated Press and other major outlets. Erica York is Vice President of Federal Tax Policy with Tax Foundation’s Center for Federal Tax Policy. Her analysis has been featured in The Wall Street Journal, The Washington Post, Politico, and other national and international media outlets.
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While a 15 percent corporate rate would boost growth, it would reduce federal tax revenue when [debt and deficits](https://taxfoundation.org/tags/debt-and-interest-rates/) are already unsustainably high, potentially squeezing out other, more pro-growth tax changes that lawmakers will consider in 2025. If a lower rate is a priority, pairing it with reforms that broaden the [tax base](https://taxfoundation.org/taxedu/glossary/tax-base/) and remove [penalties on investment](https://taxfoundation.org/research/all/federal/tax-cuts-jobs-act-business-tax-increases/) will be crucial. The 2017 Tax Cuts and Jobs Act ([TCJA](https://taxfoundation.org/taxedu/glossary/tax-cuts-and-jobs-act/)) permanently reduced the US corporate tax rate from 35 percent to 21 percent as part of a [larger tax reform](https://taxfoundation.org/research/all/federal/treatment-foreign-profits-tax-cuts-jobs-act/) to move the US from a worldwide system of taxing profits regardless of where they were earned to a territorial system focused on profits earned in the US. The reforms boosted US competitiveness, lowering the combined corporate rate (accounting for the average state tax) from 38.9 percent in 2017—then the highest in the OECD—to 25.8 percent as of 2023. The US rate is now just under the OECD weighted average of 26.2 percent, though slightly higher than the OECD simple average of 23.5 percent. A lower [corporate income tax](https://taxfoundation.org/taxedu/glossary/corporate-income-tax-cit/) A corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. rate would make the US a more attractive location for business investment, creating economic opportunities for American households and reducing incentives for businesses to move operations or profits overseas. The combined US rate would fall to 20.1 percent under Trump’s proposed 15 percent federal corporate income tax rate, just above [Estonia](https://taxfoundation.org/location/estonia/)’s combined rate of 20 percent. In the OECD, only [Hungary](https://taxfoundation.org/location/hungary/), [Ireland](https://taxfoundation.org/location/ireland/), and [Luxembourg](https://taxfoundation.org/location/luxembourg/) would have a significantly lower rate. Using Tax Foundation’s General Equilibrium Model, we estimate lowering the corporate income tax rate to 15 percent would increase long-run GDP by 0.4 percent, wages by 0.4 percent, and employment by about 93,000 full-time equivalent jobs. As economic research has consistently shown, corporate taxes are among the [most damaging](https://taxfoundation.org/blog/corporate-income-tax-most-harmful-growth-and-wages/) types of revenue raisers, disincentivizing investment and [reducing long-run wages](https://taxfoundation.org/blog/who-bears-burden-corporate-tax/) for workers. Likewise, recent economic research has confirmed that the lower corporate income tax rate under the TCJA [boosted investment](https://www.nber.org/system/files/working_papers/w32672/w32672.pdf), [lifted wages](https://www.nber.org/system/files/working_papers/w32672/w32672.pdf), and [grew economic output](https://www.nber.org/system/files/working_papers/w32672/w32672.pdf). ## #### Table 1. Long-Run Economic Effects of Reducing the Corporate Tax Rate to 15 Percent \| \| \| \|---\|---\| \| Gross Domestic Product (GDP) \| \+0.4% \| \| Gross National Product (GNP) \| \+0.4% \| \| Capital Stock \| \+0.8% \| \| Wages \| \+0.4% \| \| Full-Time Equivalent Jobs \| \+93,000 \| Source: Tax Foundation General Equilibrium Model, July 2024. Lowering the corporate rate to 15 percent would reduce federal revenue by \$673 billion from 2025 to 2034 on a conventional basis. After factoring in positive economic feedback on federal revenues, the proposal would reduce revenue by about \$460 billion over 10 years. In 2034, revenue would fall by \$75 billion on a conventional basis but by a smaller \$40 billion on a dynamic basis. The revenue loss of moving to a 15 percent corporate rate would raise the debt-to-GDP ratio from 201.2 percent in 2065 to 202.6 percent on a dynamic basis, 1.4 percentage points higher than the baseline scenario. ## #### Table 2. Revenue Effects of Reducing the Corporate Rate to 15 Percent (Billions) \| \| \| \| \| \| \| \| \| \| \| \| \| \|---\|---\|---\|---\|---\|---\|---\|---\|---\|---\|---\|---\| \| \| 2025 \| 2026 \| 2027 \| 2028 \| 2029 \| 2030 \| 2031 \| 2032 \| 2033 \| 2034 \| 2025-2034 \| \| Conventional \| \-\$78.0 \| \-\$63.5 \| \-\$66.6 \| \-\$66.2 \| \-\$61.6 \| \-\$63.4 \| \-\$63.4 \| \-\$65.9 \| \-\$69.4 \| \-\$75.3 \| \-\$673.1 \| \| Dynamic \| \-\$73.5 \| \-\$54.3 \| \-\$52.7 \| \-\$48.6 \| \-\$40.9 \| \-\$39.6 \| \-\$35.9 \| \-\$36.6 \| \-\$37.1 \| \-\$40.3 \| \-\$459.5 \| Source: Tax Foundation General Equilibrium Model, July 2024. A lower corporate tax rate would boost incomes by increasing the after-tax return on investment for owners of corporate equities, which include a large swath of Americans [across all income levels](https://taxfoundation.org/research/all/federal/retirement-accounts-taxation/), and by lifting worker wages as capital investment lifts productivity. On average, after-tax income would rise by 0.8 percent on a conventional basis and by 1.1 percent on a dynamic basis. ## #### Table 3. Distributional Effects of a 15 Percent Corporate Tax Rate (Percent Change in After-Tax Income) \| Percentile \| Income Threshold at Beginning of Band \| Conventional, Long-Run \| Dynamic, Long-Run \| \|---\|---\|---\|---\| \| 0% to 20% \| \$0 \| 0\.8% \| 1\.2% \| \| 20% to 40% \| \$13,900 \| 0\.6% \| 1\.0% \| \| 40% to 60% \| \$29,800 \| 0\.6% \| 0\.9% \| \| 60% to 80% \| \$55,400 \| 0\.6% \| 0\.9% \| \| 80% to 100% \| \$96,200 \| 0\.9% \| 1\.2% \| \| 80% to 90% \| \$96,200 \| 0\.6% \| 0\.9% \| \| 90% to 95% \| \$137,000 \| 0\.7% \| 1\.0% \| \| 95% to 99% \| \$191,500 \| 0\.8% \| 1\.2% \| \| 99% to 100% \| \$434,800 \| 1\.5% \| 1\.9% \| \| Total \| \| 0\.8% \| 1\.1% \| Note: Income thresholds are in 2024 dollars and are determined by AGI with an adjustment for household size. Source: Tax Foundation General Equilibrium Model, July 2024. A 15 percent corporate rate would be pro-growth, but it would not address the structural issues with today’s corporate [tax base](https://taxfoundation.org/taxedu/glossary/tax-base/) The tax base is the total amount of income, property, assets, consumption, transactions, or other economic activity subject to taxation by a tax authority. A narrow tax base is non-neutral and inefficient. A broad tax base reduces tax administration costs and allows more revenue to be raised at lower rates. . Currently, businesses cannot fully recover their investment costs, as they must [amortize R\&D expenses](https://taxfoundation.org/blog/rd-amortization-impact/) over five (or 15) years, and [bonus depreciation](https://taxfoundation.org/taxedu/glossary/bonus-depreciation/) is beginning to [phase out](https://taxfoundation.org/blog/us-competitiveness-taxes/). These investment penalties will blunt any positive effects of a corporate rate reduction, repeating a [mistake](https://www.ocregister.com/2023/09/20/reagans-legacy-on-taxes-what-to-take-and-what-to-leave/) from past tax reforms. If policymakers prioritized improving the tax base by making expensing for short-lived assets and R\&D expenses permanent, it would generate more growth and less revenue loss than a lower corporate tax rate: long-run GDP would rise by 0.5 percent and employment by 106,000 full-time equivalent jobs, while tax revenue would fall by \$561 billion conventionally and \$326 billion dynamically. The long-run cost would be minimal on a conventional basis, as expensing primarily changes the timing of deductions, and it would slightly raise revenue on a dynamic basis. Lowering marginal tax rates on investment, as would occur under Trump’s proposed 15 percent corporate tax rate, would be pro-growth. However, lawmakers should also consider fundamentally improving and simplifying the business tax code via expensing and [corporate integration](https://taxfoundation.org/research/all/federal/growth-opportunity-us-tax-reform-plan/). Raising [tariffs](https://taxfoundation.org/blog/trump-tax-plan-tariffs-analysis/) to pay for tax cuts, on the other hand, would be counterproductive, introducing more distortions and economic drag. Pro-growth tax reform can and should be achieved in a fiscally responsible manner, setting the federal government on a more stable and [sustainable](https://taxfoundation.org/research/all/federal/us-debt-deficits-federal-budget-spending-taxes/) fiscal trajectory while boosting American competitiveness. ## Stay informed on the tax policies impacting you. Subscribe to get insights from our trusted experts delivered straight to your inbox. [Subscribe](https://taxfoundation.org/tax-newsletter) Share this article Twitter LinkedIn Facebook Email ## About the Authors [![Garrett Watson Tax Foundation](https://taxfoundation.org/wp-content/uploads/2023/08/GWattson-300x300.png)](https://taxfoundation.org/wp-content/uploads/2023/08/GWattson.png) Expert ### [Garrett Watson](https://taxfoundation.org/about-us/staff/garrett-watson/) Director of Policy Analysis Garrett Watson is Director of Policy Analysis at the Tax Foundation, where he conducts research on federal and state tax policy. His work has been featured in The Washington Post, The Atlantic, Politico, the Associated Press and other major outlets. [![Erica York Tax Foundation](https://taxfoundation.org/wp-content/uploads/2023/08/eYork-300x300.png)](https://taxfoundation.org/wp-content/uploads/2023/08/eYork.png) Expert ### [Erica York](https://taxfoundation.org/about-us/staff/erica-york/) Vice President of Federal Tax Policy Erica York is Vice President of Federal Tax Policy with Tax Foundation’s Center for Federal Tax Policy. Her analysis has been featured in The Wall Street Journal, The Washington Post, Politico, and other national and international media outlets. ## All Related Articles - Blog October 27, 2025 ### [What to Expect from the New OBBBA Expensing for Manufacturing Structures](https://taxfoundation.org/blog/obbba-expensing-manufacturing-structures/) Expensing for manufacturing structures is a significant step forward for the tax treatment of structures, but it could be improved in several ways. 7 min read - [Research](https://taxfoundation.org/all-research-data/?post_types=all-research#results) September 9, 2025 October 9, 2025 ### [One Big Beautiful Bill Act Makes the Individual Income Tax More Complex](https://taxfoundation.org/research/all/federal/obbba-income-tax-complexity-tax-breaks/) While the OBBBA brings some stability by making many of the TCJA’s reforms permanent, it generally fails to reform the tax code’s accumulating complexity. 31 min read - Blog July 22, 2025 July 30, 2025 ### [The OBBBA Gets Expensing Right. States Should Follow Suit.](https://taxfoundation.org/blog/one-big-beautiful-bill-expensing-state-tax-conformity/) However states choose to respond to other tax provisions of the One Big Beautiful Bill Act, they should conform to the pro-growth provisions, which represent a marked improvement in the corporate tax code. 12 min read ## Topics - [Business Taxes](https://taxfoundation.org/topics/business-taxes/) - [Corporate Income Taxes](https://taxfoundation.org/topics/corporate-income-taxes/) - [Cost Recovery](https://taxfoundation.org/topics/cost-recovery/) - [Economic and Tax Modeling](https://taxfoundation.org/topics/economic-and-tax-modeling/) - [Modeling Tax Proposals](https://taxfoundation.org/topics/modeling-tax-proposals/) ## Tags - Tags: - [2024 Election](https://taxfoundation.org/tags/2024-election/) - [Debt and Interest Rates](https://taxfoundation.org/tags/debt-and-interest-rates/) - [Donald Trump](https://taxfoundation.org/tags/donald-trump/) - [Research and Development (R\&D)](https://taxfoundation.org/tags/research-and-development-rd/) - [Tax Cuts and Jobs Act (TCJA)](https://taxfoundation.org/tags/tax-cuts-and-jobs-act-tcja/) ## Locations - Locations: - [United States](https://taxfoundation.org/location/united-states/) ## Authors - [![Garrett Watson Tax Foundation](https://taxfoundation.org/wp-content/uploads/2023/08/GWattson-300x300.png)](https://taxfoundation.org/wp-content/uploads/2023/08/GWattson.png) Expert ### [Garrett Watson](https://taxfoundation.org/about-us/staff/garrett-watson/) Director of Policy Analysis - [![Erica York Tax Foundation](https://taxfoundation.org/wp-content/uploads/2023/08/eYork-300x300.png)](https://taxfoundation.org/wp-content/uploads/2023/08/eYork.png) Expert ### [Erica York](https://taxfoundation.org/about-us/staff/erica-york/) Vice President of Federal Tax Policy [![Tax Foundation](https://taxfoundation.org/wp-content/themes/taxfoundation/assets/img/tf-logo.svg)](https://taxfoundation.org/ "Tax Foundation") Stay informed on the tax policies impacting you. 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Readable Markdown	Former President [Donald Trump](https://taxfoundation.org/research/federal-tax/trump-administration-tax-proposals/) would like to [push](https://www.washingtonpost.com/business/2023/09/11/trump-tax-cuts-2024/) for a reduction in the federal corporate [tax](https://taxfoundation.org/taxedu/glossary/tax/) A tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. rate from 21 percent to [15 percen](https://www.bloomberg.com/news/articles/2024-07-16/trump-interview-highlights-plans-for-taxes-tariffs-taiwan-and-more?embedded-checkout=true)t if reelected. While a 15 percent corporate rate would boost growth, it would reduce federal tax revenue when [debt and deficits](https://taxfoundation.org/tags/debt-and-interest-rates/) are already unsustainably high, potentially squeezing out other, more pro-growth tax changes that lawmakers will consider in 2025. If a lower rate is a priority, pairing it with reforms that broaden the [tax base](https://taxfoundation.org/taxedu/glossary/tax-base/) and remove [penalties on investment](https://taxfoundation.org/research/all/federal/tax-cuts-jobs-act-business-tax-increases/) will be crucial. The 2017 Tax Cuts and Jobs Act ([TCJA](https://taxfoundation.org/taxedu/glossary/tax-cuts-and-jobs-act/)) permanently reduced the US corporate tax rate from 35 percent to 21 percent as part of a [larger tax reform](https://taxfoundation.org/research/all/federal/treatment-foreign-profits-tax-cuts-jobs-act/) to move the US from a worldwide system of taxing profits regardless of where they were earned to a territorial system focused on profits earned in the US. The reforms boosted US competitiveness, lowering the combined corporate rate (accounting for the average state tax) from 38.9 percent in 2017—then the highest in the OECD—to 25.8 percent as of 2023. The US rate is now just under the OECD weighted average of 26.2 percent, though slightly higher than the OECD simple average of 23.5 percent. A lower [corporate income tax](https://taxfoundation.org/taxedu/glossary/corporate-income-tax-cit/) A corporate income tax (CIT) is levied by federal and state governments on business profits. Many companies are not subject to the CIT because they are taxed as pass-through businesses, with income reportable under the individual income tax. rate would make the US a more attractive location for business investment, creating economic opportunities for American households and reducing incentives for businesses to move operations or profits overseas. The combined US rate would fall to 20.1 percent under Trump’s proposed 15 percent federal corporate income tax rate, just above [Estonia](https://taxfoundation.org/location/estonia/)’s combined rate of 20 percent. In the OECD, only [Hungary](https://taxfoundation.org/location/hungary/), [Ireland](https://taxfoundation.org/location/ireland/), and [Luxembourg](https://taxfoundation.org/location/luxembourg/) would have a significantly lower rate. Using Tax Foundation’s General Equilibrium Model, we estimate lowering the corporate income tax rate to 15 percent would increase long-run GDP by 0.4 percent, wages by 0.4 percent, and employment by about 93,000 full-time equivalent jobs. As economic research has consistently shown, corporate taxes are among the [most damaging](https://taxfoundation.org/blog/corporate-income-tax-most-harmful-growth-and-wages/) types of revenue raisers, disincentivizing investment and [reducing long-run wages](https://taxfoundation.org/blog/who-bears-burden-corporate-tax/) for workers. Likewise, recent economic research has confirmed that the lower corporate income tax rate under the TCJA [boosted investment](https://www.nber.org/system/files/working_papers/w32672/w32672.pdf), [lifted wages](https://www.nber.org/system/files/working_papers/w32672/w32672.pdf), and [grew economic output](https://www.nber.org/system/files/working_papers/w32672/w32672.pdf). #### Table 1. Long-Run Economic Effects of Reducing the Corporate Tax Rate to 15 Percent Source: Tax Foundation General Equilibrium Model, July 2024. Lowering the corporate rate to 15 percent would reduce federal revenue by \$673 billion from 2025 to 2034 on a conventional basis. After factoring in positive economic feedback on federal revenues, the proposal would reduce revenue by about \$460 billion over 10 years. In 2034, revenue would fall by \$75 billion on a conventional basis but by a smaller \$40 billion on a dynamic basis. The revenue loss of moving to a 15 percent corporate rate would raise the debt-to-GDP ratio from 201.2 percent in 2065 to 202.6 percent on a dynamic basis, 1.4 percentage points higher than the baseline scenario. #### Table 2. Revenue Effects of Reducing the Corporate Rate to 15 Percent (Billions) \| \| \| \| \| \| \| \| \| \| \| \| \| \|---\|---\|---\|---\|---\|---\|---\|---\|---\|---\|---\|---\| \| \| 2025 \| 2026 \| 2027 \| 2028 \| 2029 \| 2030 \| 2031 \| 2032 \| 2033 \| 2034 \| 2025-2034 \| \| Conventional \| \-\$78.0 \| \-\$63.5 \| \-\$66.6 \| \-\$66.2 \| \-\$61.6 \| \-\$63.4 \| \-\$63.4 \| \-\$65.9 \| \-\$69.4 \| \-\$75.3 \| \-\$673.1 \| \| Dynamic \| \-\$73.5 \| \-\$54.3 \| \-\$52.7 \| \-\$48.6 \| \-\$40.9 \| \-\$39.6 \| \-\$35.9 \| \-\$36.6 \| \-\$37.1 \| \-\$40.3 \| \-\$459.5 \| Source: Tax Foundation General Equilibrium Model, July 2024. A lower corporate tax rate would boost incomes by increasing the after-tax return on investment for owners of corporate equities, which include a large swath of Americans [across all income levels](https://taxfoundation.org/research/all/federal/retirement-accounts-taxation/), and by lifting worker wages as capital investment lifts productivity. On average, after-tax income would rise by 0.8 percent on a conventional basis and by 1.1 percent on a dynamic basis. #### Table 3. Distributional Effects of a 15 Percent Corporate Tax Rate (Percent Change in After-Tax Income) \| Percentile \| Income Threshold at Beginning of Band \| Conventional, Long-Run \| Dynamic, Long-Run \| \|---\|---\|---\|---\| \| 0% to 20% \| \$0 \| 0\.8% \| 1\.2% \| \| 20% to 40% \| \$13,900 \| 0\.6% \| 1\.0% \| \| 40% to 60% \| \$29,800 \| 0\.6% \| 0\.9% \| \| 60% to 80% \| \$55,400 \| 0\.6% \| 0\.9% \| \| 80% to 100% \| \$96,200 \| 0\.9% \| 1\.2% \| \| 80% to 90% \| \$96,200 \| 0\.6% \| 0\.9% \| \| 90% to 95% \| \$137,000 \| 0\.7% \| 1\.0% \| \| 95% to 99% \| \$191,500 \| 0\.8% \| 1\.2% \| \| 99% to 100% \| \$434,800 \| 1\.5% \| 1\.9% \| \| Total \| \| 0\.8% \| 1\.1% \| Note: Income thresholds are in 2024 dollars and are determined by AGI with an adjustment for household size. Source: Tax Foundation General Equilibrium Model, July 2024. A 15 percent corporate rate would be pro-growth, but it would not address the structural issues with today’s corporate [tax base](https://taxfoundation.org/taxedu/glossary/tax-base/) The tax base is the total amount of income, property, assets, consumption, transactions, or other economic activity subject to taxation by a tax authority. A narrow tax base is non-neutral and inefficient. A broad tax base reduces tax administration costs and allows more revenue to be raised at lower rates. . Currently, businesses cannot fully recover their investment costs, as they must [amortize R\&D expenses](https://taxfoundation.org/blog/rd-amortization-impact/) over five (or 15) years, and [bonus depreciation](https://taxfoundation.org/taxedu/glossary/bonus-depreciation/) is beginning to [phase out](https://taxfoundation.org/blog/us-competitiveness-taxes/). These investment penalties will blunt any positive effects of a corporate rate reduction, repeating a [mistake](https://www.ocregister.com/2023/09/20/reagans-legacy-on-taxes-what-to-take-and-what-to-leave/) from past tax reforms. If policymakers prioritized improving the tax base by making expensing for short-lived assets and R\&D expenses permanent, it would generate more growth and less revenue loss than a lower corporate tax rate: long-run GDP would rise by 0.5 percent and employment by 106,000 full-time equivalent jobs, while tax revenue would fall by \$561 billion conventionally and \$326 billion dynamically. The long-run cost would be minimal on a conventional basis, as expensing primarily changes the timing of deductions, and it would slightly raise revenue on a dynamic basis. Lowering marginal tax rates on investment, as would occur under Trump’s proposed 15 percent corporate tax rate, would be pro-growth. However, lawmakers should also consider fundamentally improving and simplifying the business tax code via expensing and [corporate integration](https://taxfoundation.org/research/all/federal/growth-opportunity-us-tax-reform-plan/). Raising [tariffs](https://taxfoundation.org/blog/trump-tax-plan-tariffs-analysis/) to pay for tax cuts, on the other hand, would be counterproductive, introducing more distortions and economic drag. Pro-growth tax reform can and should be achieved in a fiscally responsible manner, setting the federal government on a more stable and [sustainable](https://taxfoundation.org/research/all/federal/us-debt-deficits-federal-budget-spending-taxes/) fiscal trajectory while boosting American competitiveness. ## Stay informed on the tax policies impacting you. Subscribe to get insights from our trusted experts delivered straight to your inbox. [Subscribe](https://taxfoundation.org/tax-newsletter) ## About the Authors Garrett Watson is Director of Policy Analysis at the Tax Foundation, where he conducts research on federal and state tax policy. His work has been featured in The Washington Post, The Atlantic, Politico, the Associated Press and other major outlets. Erica York is Vice President of Federal Tax Policy with Tax Foundation’s Center for Federal Tax Policy. Her analysis has been featured in The Wall Street Journal, The Washington Post, Politico, and other national and international media outlets.
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