American *VS* Foreign Companies' Tax Rates

American *VS* Foreign Companies' Tax Rates

Although I am not, by any stretch of the imagination, a tax expert, I'm good at long-division using a spreadsheet. Also, I am quite able to discern the income statements of any public company using sites like finance.google.com.

I analyzed the income statements of a random assortment of foreign companies. These companies are based all over the world, and they have been somewhat weighted to properly reflect that particular's country in the world economy. The sample size of foreign countries that I used was N".

From my previous report, I determined that the 500 biggest American companies pay on the average: 2.4% of their revenues as taxes, and

32.4% of their pretax income as taxes. The foreign companies, on the other hand, pay 14.3% and 32.9%, respectively.

Based on this, I would think that, basically, the US and foreign corporations pay about the same rate of their pretax income as taxes.

However, the foreign corporations have much higher pretax income, when compared to their American counterpart, and:

  1. They seem to have much less costs and higher profit margins, in general.
  2. The foreign companies must incur less depreciation costs, less COGS/SG&A (which is employee compensation), and less interest costs than when compared to their American counterparts. American corporations pay more to their employees, and this cost decreases their income (both pretax and post-tax), but this doesn't impact the ratio of PreTaxIncome/PostTaxIncome.

I have the data from the 22 companies that I analyzed down below.

Please give me feedback on my analysis.

Annualized Revenue Total Pretax Income Net Income

48948 5640 4348 86604 -5920 -9860 59473 23483 15390 26289 24372 17178 40187 5184 3888 87735 19299 13138 35478 9001 6660 59473 23483 15390 105216 14888 10368 355782 50576 31331 118912 7694 5666 356959 129238 87062 88083 20028 10011 835037 204381 145625 56441 10684 8906 22716 7452 5214 38947 7487 6518 136824 25335 13181 32242 15233 11825 108897 6543 4120 291438 31611 20843 8090 2093 1521

2991681.24 635692.22 426802.79 % Taxes from PreTax Income .32860 % Taxes from Total Revenue .14266

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