This Is the Country That Collects the Most Taxes
There is an old saying that the only things certain in life are death and taxes. In the United States, that is not entirely true. The richest Americans should pay about 40% of their income to taxes authorities, which include federal, state and local obligations. However, study after study shows that the richest Americans pay little or no taxes at all. There has been an uproar that this includes some of America’s billionaires.
The importance of taxes, both individual and corporate, cannot be underestimated. In many cases, those are a very high percentage of the income governments use to fund their operations. Low tax revenue means that some critical government services may be discontinued or curtailed.
While many Americans complain that the taxes they pay are too high, many countries have tax rates that are much higher. As is true in the United States, national tax revenue is often measured as a percentage of a country’s gross domestic product, which offers a glimpse into how dependent a country is on tax collection. When a country’s GDP declines, tax revenue does too, which can require adjustments to its tax rates to compensate for the loss of revenue. This rarely happens in the United States.
To find the country collecting the most in taxes, 24/7 Wall St. reviewed data from the Organisation for Economic Co-operation and Development, ranking countries by their 2019 tax revenue as a percentage of their GDP. There were 112 countries with available data. Tax revenue in U.S. dollars also came from OECD. Population and GDP per capita using purchasing power parity in constant 2017 international dollars came from the World Bank World Development Indicators.
Tax as a percentage of 2019 GDP ranges from 10.3% in the Kingdom of Bhutan to 48.2% in Nauru, a small Micronesian island country of about 11,000 people. The United States lands between these extremes, at 24.5% in 2019.
These are the numbers for Nauru:
- Tax revenue as a percentage of GDP: 48.2%
- Tax revenue in U.S. dollars: $55.6 trillion (77th out of 112 countries)
- GDP per capita: N/A
- Total population: 10,834 (111th out of 112 countries)
Get Our Free Investment Newsletter
Click here to see all the countries collecting the most taxes.
Sponsored: Find a Qualified Financial Advisor:
Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.
Source: Read Full Article