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Top 10 countries with the highest income tax rates in the world

As we know from Benjamin Franklin, nothing in the world is certain except death and taxes. With very few exceptions, governments across the planet impose various taxes on their citizens to fund a wide variety of services and institutions.

Top 10 countries with the highest income tax rates in the world
Top 10 countries with the highest income tax rates in the world

The most important and most common form of tax is the income tax . People are required to give the government a certain percentage of their annual income. That percentage or tax rate varies widely from country to country and sometimes even regions within a country. Most countries also apply progressive tax rates. This ratio increases with the income level of the respective taxpayer. Tax rates can also vary based on marital status and whether an individual has children.


The following ranking lists the 10 countries with the highest average income tax rates. The ranking is therefore based on the most up-to-date estimate of the tax rate (including deductions) paid by the average citizen in his or her respective country.


10 countries with the highest average income tax rates

Top 10 countries with the highest average income tax (summary)


(as of November 2019)


Average income tax rate: 33,8%

Average income tax rate: 33,5%

Average income tax rate: 31,7%

Average income tax rate: 30,3%

Average income tax rate: 30,0%

Average income tax rate: 29,6%

Average income tax rate: 28,5%

Average income tax rate: 28,4%

Average income tax rate: 28,1%

Average income tax rate: 27,2%


The 10 countries with the highest average income tax rates, based on income taxes paid by the average person.


1. Belgium

Belgian flag
Belgian flag

Income tax type: Progressive

Highest marginal income tax rate: 50%

Lowest marginal income tax rate: 25%

Belgium has the highest average personal income tax rate in the world. The average Belgian must contribute 33.8%, or a third, of his annual income to the government. People in Belgium pay a progressive income tax of between 25% and 50%. For married couples, the average rate is around 30%, while those with young children or more even pay a little less than 30% on average.


 

2. Denmark

Danish flag
Danish flag

Income Tax Type: Progressive (first deduction ~ $7,200 per year)

Highest marginal income tax rate: 55.9%

Lowest marginal income tax rate: 31.8%


At the same rate as people in Belgium, Danes must also contribute about a third of their annual income to the Danish government. The average personal income tax is around 33.5%. The Danish progressive tax system has the highest marginal tax rates in the world. The highest rate is 55.9% and the lowest is 31.8%. But the Danes don't seem to mind, as they are consistently reported to be one of the happiest countries in the world. The first 46,000 DKK (Danish krones) of one's annual income, about €6,100 or $7,200, is also deductible, which reduces the Danish net tax rate a bit.


 

3. Austria

Austrian flag
Austrian flag

Income tax type: Progressive

Highest marginal income tax rate: 55%

Lowest marginal income tax rate: 0%


Austria has the third highest per capita income tax in the world. It's at around 31.7%. The Austrian tax system has eight marginal income tax brackets. The lowest, for those with an annual income of less than €11,000 (~$12,000). it is at zero. This means that the poorest people in Austria do not pay any taxes. The highest marginal income tax rate is 55%, which applies to millionaires and billionaires.



 

4. Germany

German flag
German flag

Income Tax Type: Progressive (+ solidarity surcharge; first deduction ~$10,000 per year)

Highest marginal income tax rate: 47.5%

Lowest marginal income tax rate: 14%


Germany has the fourth highest average personal income tax rate. The progressive tax system in Germany shows taxpayers to pay between 14% and 47.5%. They are also required to pay 5.5% on the tax bill as part of a solidarity surcharge introduced after German reunification in 1990. The first 9,100 euros (~$10,000) are tax-free, which is This reduces the average income tax quite a bit. The German tax system also offers many special deductions for married couples and especially for those with children, bringing the average income tax rate in Germany down to 30.3%. Of course, this is still one of the highest income taxes in the world.


 

5. Finland

Finnish flag
Finnish flag

Income tax type: Progressive (+ social contribution tax)

Highest marginal income tax rate: 31.3%

Lowest marginal income tax rate: 6%


The average personal income tax rate in Finland is around 30%. The Finnish tax system is progressive in nature with four brackets ranging from 6% to 31.3%. Finns are also required to pay an indirect income tax, most importantly a social contribution tax. The tax system in Finland does not take into account the marital status of the taxpayer.


 

6. Slovenia

Slovenian flag
Slovenian flag

Income tax type: Progressive

Highest marginal income tax rate: 50%

Lowest marginal income tax rate: 16%


 

7. Hungary

Hungarian flag
Hungarian flag

Income tax type: Fixed (15% + social contribution tax)



 

8. Netherlands

Dutch national flag
Dutch national flag

Income Tax Type: Progressive (first-time deduction ~ $23,000 per year)

Highest marginal income tax rate: 51.8%

Lowest marginal income tax rate: 36.7%


 

9. Italy

Italian flag
Italian flag

Income Tax Type: Progressive (first-time deduction ~ $9,400 per year)

Highest marginal income tax rate: 47%

Lowest marginal income tax rate: 23%


 

10. Turkey

Turkish flag
Turkish flag

Income tax type: Progressive

Highest marginal income tax rate: 35%

Lowest marginal income tax rate: 15%


The 10 countries with the highest average income tax rates, based on how much income the average person pays.


 

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