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As a nonpartisan, educational organization, the Tax Foundation has earned a reputation for independence and credibility. Our global tax policy team regularly provides accessible, data-driven insights, including a survey of corporate tax rates around the world, from sources such as the Organisation for Economic Co-Operation and Development (OECD), the European Commission, and others.
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A new report shows that corporate tax rates around the world continue to level off. “We aren’t seeing a race to the bottom, we’re seeing a race toward the middle,” said Sean Bray, EU policy analyst at the Tax Foundation.
Governments often justify higher tax burdens with more extensive public services. However, the cost of these services can be more than half of an average worker’s salary.
Designing tax policy in a way that sustainably finances government activities while minimizing distortions is important for supporting a productive economy.
Denmark (55.9 percent), France (55.4 percent), and Austria (55 percent) have the highest top statutory personal income tax rates among European OECD countries.
To recover from the pandemic and put the global economy on a trajectory for growth, policymakers need to aim for more generous and permanent capital allowances. This will spur real investment and can also contribute to more environmentally friendly production across the globe.
The EU countries with the highest standard VAT rates are Hungary (27 percent), Croatia, Denmark, and Sweden (all at 25 percent). Luxembourg levies the lowest standard VAT rate at 16 percent, followed by Malta (18 percent), Cyprus, Germany, and Romania (all at 19 percent).
In many countries, investment income, such as dividends and capital gains, is taxed at a different rate than wage income. Denmark levies the highest top capital gains tax among European OECD countries, followed by Norway, Finland, and France.
Portugal, Germany and France have the highest corporate tax rates in Europe. How does your country compare?
Compared to other industrialized countries, the United States relies more on individual income taxes and property taxes and less on consumption taxes.
Designing tax policy in a way that sustainably finances government activities while minimizing distortions is important for supporting a productive economy.
Denmark (55.9 percent), France (55.4 percent), and Austria (55 percent) have the highest top statutory personal income tax rates among European OECD countries.
The VAT is a consumption tax assessed on the value added in each production stage of a good or service. Every business along the value chain receives a tax credit for the VAT already paid. The end consumer does not, making it a tax on final consumption.