Date: 2016-11-11 10:08 am (UTC)
US federal corporation tax rates are 35%. Only Zambia, Cameroon and Greece have higher rates of CT.

Japan has a Corporation Tax rate of 32%. About the same as the USA. Germany a shade lower at 30%. France ranges between 15-33%

The UK CT rate is 20% and falling. The Netherlands is 20%. So is Russia Singapore and Hong Kong at 17%. Ireland 12.5%.

So I don't think US corporation rates are low in comparison to other large economies.

And US personal maximum tax rates for federal tax are 40% with up to 13% state tax on top for total of 53% depending where you live. And payroll taxes are not particularly low either. So higher CT is doesn't appear to be offset by lower personal taxation. The USA's tax to GDP ratio is about 25% compared to the EU's 36% but in the EU you get health care included in your tax bill.
I think the constitutional restriction you are refering to is in the Californian constitution rather than the US constitution. My understanding of Californian constitutional law is that it is difficult to increase taxes as tax increases require a 2/3rds majority in both houses in the California legislature. The relevant ballot I think is Prop 13 in 1978.

https://en.wikipedia.org/wiki/California_Proposition_13_(1978)#Other_taxes_created_or_increased

So California *could* raise taxes if they wanted to. They would just have to really, really want to. And given how many profitable companies are based in California and will, post a reduction in federal corporation taxes be a wash with money, I think Californians might feel a bit more relaxed about state and local taxation.

There's also a tax incidence effect, Federal corporation taxes represent a cost of doing business for corporations. If that cost is reduced then there is more money available for suppliers, customers, employees and owners - most of whom I think will be based in California and paying tax in California. So California might end up not paying federal taxes and therefore consuming federal expenditure in Alabama and Arkansas and end up paying more state and local taxes by having more profit and wages located in California even if the tax rates remain the same.
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