[3] Organisation for Economic Co-operation and Development (OECD), “Tax and Economic Growth,” Economics Department Working Paper No. This is a list of the maximum potential tax rates around Europe for certain income brackets. The Tax Foundation is the nation’s leading independent tax policy nonprofit. Elke Asen is a Policy Analyst with the Tax Foundation’s Center for Global Tax Policy, focusing on international tax issues and tax policy in Europe. Latvia, which recently adopted the Estonian system for corporate taxation, also has a relatively efficient system for taxing labor. Its top score is driven by four positive features of its tax code. The Index’s property tax component evaluates state and local taxes on real and personal property, net worth, and asset transfers. The Tax Foundation is the nation’s leading independent tax policy nonprofit. 23, 2019, https://taxfoundation.org/publications/sources-of-government-revenue-in-the-oecd/. For the sixth year in a row, France has the least competitive tax system in the OECD. Many countries have recognized this a… These variables measure not only the level of taxes, but also how taxes are structured. This page displays a table with actual values, consensus figures, forecasts, statistics and … Tax … Corporate tax base improvements have been put in place in the United States, United Kingdom, and Canada, while tax bases were made less competitive in Chile and Korea. This year, the states with the best scores on the property tax component are New Mexico, Indiana, North Dakota, Idaho, Utah, and Delaware. The new rules apply to passive income. A sales tax is levied on retail sales of goods and services and, ideally, should apply to all final consumption with few exemptions. Washington, DC 20005, Tax Expenditures, Credits, and Deductions, Small Business, Pass-throughs, and Non-profits, Sources of Government Revenue in the OECD, Opportunities for Pro-Growth Tax Reform in Austria, Tax Proposals, Comparisons, and the Economy. It is not intended to represent the true tax burden to either the corporation or the individual in the listed country. The new policy provides businesses with a 2 percent annual allowance for spending on industrial buildings. Prior to joining the Tax Foundation, Daniel worked in the United States Senate at the Joint Economic Committee as part of Senator Mike Lee’s (R-UT) Social Capital Project and on the policy staff for both Senator Lee and Senator Tim Scott (R-SC). For the sixth year in a row, Estonia has the best tax code in the OECD. First, it has a 20 percent tax rate on corporate income that is only applied to distributed profits. States with the worst scores in this component are Connecticut, Vermont, Massachusetts, New Jersey, New York, and Rhode Island, plus the District of Columbia. As is the case in several other EU countries, Slovenia adopted new Controlled Foreign Corporation legislation. It has one of the highest corporate income tax rates in the OECD (34.4 percent), high property taxes, a net tax on real estate wealth, a financial transaction tax, and an estate tax. Our work depends on support from members of the public like you. Three measures of compliance time with corporate income, individual income, and consumption taxes have shown significant improvement in the last several years. The 2017 tax reform in the United States brought the statutory corporate income tax rate from among the highest in the world closer to the middle of the distribution. Switzerland has a relatively low corporate tax rate (21.1 percent), a low, broad-based consumption tax, and a relatively flat individual income tax that exempts capital gains from taxation. The tax percentage for each country listed in the source has been added to the chart. She holds a BS in Economics from Ludwig Maximilian University of Munich. These rules apply tax to passive income earned by or attributed to a foreign subsidiary simply for tax purposes (non-genuine arrangements). Average corporate tax compliance time fell to 24 hours from 44.5 in 2018; individual income tax compliance time fell to 71 hours from 91 hours in 2018; and consumption tax compliance time fell to 75 hours from 80 hours. Lithuania has the third lowest corporate income tax rate at 15 percent, a relatively neutral treatment of capital investment costs, and a well-structured individual income tax system. See what the latest tax proposals could mean for you. This article lists countries alphabetically, with total tax revenue as a percentage of gross domestic product (GDP) for the listed countries. In addition, all five countries have high consumption taxes, with rates of 20 percent or higher, except for Chile, at 19 percent. The variety of approaches to taxation among OECD countries creates a need for a way to evaluate these systems relative to each other. Separately, a neutral tax code is simply one that seeks to raise the most revenue with the fewest economic distortions. 1325 G St NW An individual income tax (or personal income tax) is levied on the wages, salaries, investments, or other forms of income an individual or household earns. [1] Elke Asen and Daniel Bunn, “Sources of Government Revenue in the OECD, 2019,” Tax Foundation, Apr. Note: This map is part of a series in which we will examine each of the five major components of our 2020 State Business Tax Climate Index. Suite 950 A tax code that is competitive and neutral promotes sustainable economic growth and investment while raising sufficient revenue for government priorities. Many governments exempt goods like groceries; base broadening, such as including groceries, could keep rates lower. Over the past few decades, marginal tax rates on corporate and individual income have declined significantly across the Organisation for Economic Co-operation and Development (OECD). Suite 950 This reduced its score for international tax regulations. Our work depends on support from members of the public like you. Across the nation, property taxes impose one of the most substantial state and local tax burdens most businesses face. List of countries by tax revenue as percentage of GDP, European Union Common Consolidated Corporate Tax Base, Institute on Taxation and Economic Policy, List of countries by real GDP growth rate, List of countries by social welfare spending, "General government - General government revenue - OECD Data", Directorate-General for Taxation and Customs Union, Publications Office of the European Union, "India's tax-GDP ratio plunges to 9.88% in FY20, lowest in 10 years", "Economic Data and Statistics on World Economy and Economic Freedom", http://www.tuik.gov.tr/PreHaberBultenleri.do?id=21512, Federal Tax Revenue as Share of GDP 1990-2009 for 148 Countries - excludes voluntary insurance programs, 5506.0 - Taxation Revenue, Australia, 2008-09, Tax revenue as an automatic fiscal stabiliser - a South African perspective, List of top international rankings by country, Health expenditure by country by type of financing, https://en.wikipedia.org/w/index.php?title=List_of_countries_by_tax_revenue_to_GDP_ratio&oldid=978061070, Articles with dead external links from March 2020, Articles with permanently dead external links, Short description is different from Wikidata, Wikipedia articles in need of updating from September 2015, All Wikipedia articles in need of updating, Creative Commons Attribution-ShareAlike License, This page was last edited on 12 September 2020, at 17:33.
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