Why reduce the corporate income tax rate to zero instead of the norm of about 25-27%?
Many countries have significantly reduced corporate tax rates and created incentives to attract investment, particularly in high-margin knowledge based economic activities, and these reforms have been remarkably successful. For example, between 1993 and 2003, Ireland gradually cut its corporate tax rate from 40% to 12.5%. Driven by a significant increase in foreign investment, Ireland generated double-digit GDP growth in the mid-late 1990s and GDP growth has averaged roughly 5% a year since then. (That is better than the U.S. or any of the other original 15 EU member states.) And Irelands GDP per capita and wages are now higher than most EU countries and the U.S. Likewise, Switzerland and Singapore have low corporate tax rates and they offer special tax incentives and tax holidays (tax free periods from 5-15 years) for companies that undertake certain high-level entrepreneurial activities such as research and development or invest in high-tech capital intensive businesses. Switzerland
