Many governments adjust their tax regimes to stimulate investment and growth. Table 2 below provides data on corporate tax rates and business investment for selected countries in 2022.
| Country | Average corporate tax rate (%) | Business investment as a % of GDP |
|---|---|---|
| Singapore | 17.0 | 26.5 |
| France | 25.8 | 19.2 |
| Brazil | 34.0 | 15.4 |
| Hungary | 9.0 | 21.8 |
| Sweden | 20.6 | 24.5 |
| Japan | 30.6 | 20.1 |
| USA | 21.0 | 18.0 |
Using Table 2, evaluate to what extent differences in corporate tax rates explain differences in business investment as a percentage of GDP in selected countries.
