The American story tells a tale of innovators. Despite the centrality of innovation to our country's history, we no longer lead the world in supporting American entrepreneurialism. In particular, the U.S. tax code has built up many obstacles to our productivity. At 40%, the U.S. corporate tax rate looms as the highest in the world—far above the OECD average of 27.8%. As other nations emphasize the development of innovation hubs, the U.S. could easily lose our competitive edge.
In order to bolster our ability to compete in a global marketplace, the U.S. should seek out reforms that will spur our economy and create jobs. We should work to enact an internationally competitive tax regime that includes a territorial tax system to provide better access to foreign earnings for U.S. investments; a globally competitive corporate tax rate; and permanent and enhanced R&D credits. Creating a truly globally competitive corporate tax regime can help the U.S. cement its legacy as the developer of innovations that improve the world as we know it.