Strategic Management: A Competitive Advantage Approach, Concepts and Cases, 16/e

Tax Rates and Tax Inversions

Tax Rates

Tax rates in countries are important in strategic decisions regarding where to build manufacturing facilities or retail stores or even where to acquire other firms. High corporate tax rates deter investment in new factories and also provide strong incentives for corporations to avoid and evade taxes. Corporate tax rates vary considerably across countries and companies. As indicated in Table 11-2, the top national statutory corporate tax rates in 2015 among sample countries ranged from 0 percent in Bermuda to 55 percent in the United Arab Emirates (UAE). Note that some countries have a flat tax, which often, on adoption, triggers a surge in foreign direct investment. Signet Jewelers Ltd., owner of Kay’s Jewelers, ...