Rightsizing a state’s sales tax base can not only make the tax more equitable and better align it with the modern economy but also generate revenue that can be used to pay down the rates of more harmful taxes. That is why sales tax base broadening, which is favored by public finance scholars across the political spectrum, features in many tax reform plans.
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The taxation of capital—at both the individual and the corporate level—is much debated and affects economic growth by lowering the incentives to save and invest.
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Most countries’ personal income taxes have a progressive structure, meaning that the tax rate paid by individuals increases as they earn higher wages. The highest tax rate individuals pay differs significantly across Europe, with Denmark (55.9 percent), France (55.4 percent), and Austria (55 percent) having the highest top statutory personal income tax rates among European OECD countries.
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Location Matters is an account of tax complexity and the ways that tax structure affect competitiveness. For policymakers, it represents an opportunity to explore the seemingly more arcane tax provisions that can have a significant impact on business tax burdens, and to discover how their tax code—often completely by accident—picks winners and losers.
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Under President Biden’s tax plan, the United States would tax corporate income at the highest top rate in the industrialized world, averaging 65.1 percent.
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Estate tax is levied on the property of the deceased and is paid by the estate itself. Inheritance taxes, in contrast, are only levied on the value of assets transferred and are paid by the heirs. Gift taxes are levied when property is transferred by a living individual. The majority of European countries covered in today’s map currently levy estate, inheritance, or gift taxes.
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Taxes on goods and services were on average the greatest source of tax revenue for Latin American and Caribbean countries
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The individual income tax is one of the most significant sources of revenue for state and local governments, generating approximately 24 percent of state and local tax collections in FY 2018.
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