Which Country Pays The Most Taxes

Which Country Pays The Most Taxes – Fuel prices have risen all over the world and there are many reasons for the rise in prices, including rising crude oil prices and international wars.

Some countries charge so much that half of the price paid at the pump goes directly to the government.

Which Country Pays The Most Taxes

In the UK, fuel is taxed twice, the fuel tax is deducted and then VAT (value added tax, in NZ we call it GST) of 20 per cent is added.

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A few years ago, the US Department of Energy’s Alternative Fuels Data Center published a study on how much gasoline and diesel is taxed around the world. Although the chart is a few years old and there will certainly be some changes, it gives a good idea of ​​what different countries charge for fuel taxes.

The DoE graph shows that Indonesia, Brazil, the United States, Canada, Mexico and China pay the lowest fuel taxes. Countries such as Great Britain, the Netherlands, Turkey and Italy pay the most.

New Zealand is in the middle of the chart, but below average. But we know this information is old, and while most countries’ taxes haven’t changed, New Zealand has seen some changes in recent years.

Auckland Council’s regional fuel levy of 11.5 cents per liter came into effect in 2018, a year ahead of that timetable. In February this year (2022), the MTA’s energy and environment sector manager, Ian Bagot, announced that 52 per cent of the cost of fuel came from taxes, including fuel excise, emissions trading scheme tax and GST.

Worldwide Tax Summaries: Tax: Services: Pwc

The government recently reduced fuel excise and road user charges by 25 cents per litre. Currently, fuel tax is around 55 cents per litre. Then there is 35 cents in GST and about 15 cents for the emissions trading scheme. That works out to about $1.05 a litre, less than half of what you’d pay at the pump.

So while the Kiwis are hitting the pump a bit at the moment, there seem to be a lot of countries that are worse off in terms of fuel tax. Total US tax revenue was 24 percent of GDP, well below the weighted average of other OECD countries (34 percent). Total US tax revenue was 24 percent of GDP, well below the weighted average of other OECD countries (34 percent).

US taxes are lower than in other high-income countries (Figure 1). In 2018, taxes at all levels of US government accounted for 24 percent of gross domestic product (GDP), compared to an average of 34 percent for the other 35 member countries of the Organization for Economic Co-operation and Development (OECD).

Among OECD countries, only Chile, Ireland and Mexico collected less tax revenue relative to GDP than the United States. In seven European countries, including France, where taxes were 46 percent of GDP, taxes exceeded 40 percent of GDP. But these countries generally offer a wider range of public services than the United States.

Eu Tax Observatory

Income and profits taxes: In 2018, taxes on personal income and business profits accounted for 45 percent of total US tax revenue, higher than other OECD countries, where such taxes accounted for 34 percent of the total (Figure 2). In this category, the USA is led by Australia, Denmark and New Zealand, which account for more than half of the total revenue from such taxes. In the United States, taxes on personal income and profits accounted for 41 percent of total tax revenue, compared to an average of 24 percent in OECD countries.

Social Security Contributions: The United States collects slightly less than 25 percent of tax revenue for pension, disability, and other social security programs, compared to an OECD average of 26 percent. Some countries were well above the average: the Czech Republic, Japan, Slovakia and Slovenia each collected 40 percent or more of their income from social benefits.

Property Taxes: Property taxes provide almost double the share of US tax revenues (12 percent in 2018), compared to the OECD average of 6 percent. Almost all property tax revenue in the United States is collected by state and local governments.

Goods and Services Taxes: The United States relies less on goods and services taxes (including general consumption taxes and taxes on specific goods and services) than other OECD countries, collecting 18 percent of its tax revenues this way. OECD. Value added tax (VAT), a type of general consumption tax levied over time, is the main source of consumption tax revenue in the OECD. VAT is used in 160 countries of the world, including 35 OECD countries, except the USA. Most sales tax revenue in the United States is collected by state and local governments. Higher marginal personal income tax rates have seen renewed interest in recent years. For example, center-left economists Emmanuel Saez and Thomas Piketty have proposed tax increases of up to 80 percent for high-income earners (Saez & Piketty, 2013). US Congresswoman Alexandria Ocasio-Cortez proposed a top marginal tax rate of 70 percent (Kapur, 2019). The taxation of high-income earners reflects the overall level of redistribution in the tax system and the amount of distortions introduced by the system. As such, it is perhaps the best example of the conflict between efficiency and equity in tax systems (a central part of public economics). Therefore, top marginal tax rates are of great academic interest (eg Saez, 2001).

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Policy debates about taxing high-income earners usually revolve around income taxes, but to get a more complete picture of the tax burden on high-income earners, it is important to consider effective marginal taxes. The effective marginal tax rate answers the following question: “If a worker receives a raise that increases the employer’s total spending by one dollar, how much of that will the government share in income taxes, social security contributions, and welfare taxes?” Consumption taxes?” In principle, it does not matter how the tax burden is distributed between different taxes – all taxes that affect the return to work must be taken into account.

Despite their political importance, data on effective marginal tax rates are not readily available because they are difficult to research and calculate. As far as we know, this is the most recent compilation of the most effective marginal tax rates in developed economies.[1] First, by combining data from international accounting firms, the OECD and the European Commission, we can calculate marginal tax rates in 41 OECD and/or EU member countries. The methodology is described below.

The full country ranking is shown in Figure 1. Effective marginal tax rates vary widely: from 29% in Bulgaria to 76% in Sweden. 28 countries have an effective marginal tax rate above 50 percent. The average for all countries is 56 percent. Regional differences are analyzed in more detail in the next section.

Countries should be careful not to impose an excessive tax burden on high-income earners for several reasons. In the short run, higher marginal tax rates encourage tax avoidance and evasion and may cause higher earners to reduce their workforce or hours. Under reasonable assumptions about behavioral responses to taxation, the Laffer curve, which shows the relationship between tax rate and tax revenue, peaks at high revenues of 60-75%. This means that many OECD countries are close to or have passed their peak tax revenues (Lundberg, 2017a). In the long run, higher marginal taxes may affect career choices and migration decisions. They also reduce returns to education and entrepreneurship.

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Governments differ in the types of taxes they impose (see Table 1 below). All the countries in the sample have a centralized income tax and some form of consumption tax (state sales tax in the US and VAT in all other countries), but otherwise they have nothing in common in high taxation. the recipient Eleven countries impose a local or regional income tax, and 12 countries have solidarity contributions or similar additional taxes on high incomes. 23 are unpaid social contributions from employees, 26 from employers.

This suggests that the entire range of taxes should be taken into account when comparing marginal tax burdens across countries. For example, Hungary has a flat income tax of 15 percent, while the United States has a progressive federal income tax with a top marginal tax of 37 percent. Because the United States has low payroll and consumption taxes, the effective marginal tax rate is 47 percent. On the other hand, significant social contributions are paid by both employers and employees in Hungary. In addition, this country has the highest VAT in the world. The result is an effective tax rate of 57 percent—13 places higher than the US national ranking.

All six countries with the highest effective marginal taxes have higher taxes on wages. This is in contrast to many countries that have payroll taxes on high earners

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