Special Report

Countries Collecting the Most Taxes

The COVID-19 pandemic has disrupted economic activity worldwide, taking its toll not only on people’s personal finances but on public revenue as well.

The lockdowns interfered with business activity and pushed unemployment to historical heights. In addition, industrial activity has slowed or stalled, and there were sharp declines in business and leisure travel. All of which have driven down collection of individual and business income taxes, value-added taxes, and taxes on goods and services, blasting holes in national budgets worldwide.

It could take more than three years from the onset of the pandemic for developing countries to return to pre-pandemic levels of economic growth, according to estimates provided by the Organization for Economic Cooperation and Development earlier this year. More advanced economies may see a return to economic normalcy in 2022. (These are the 25 countries where rich are taxed the most.)

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.

To find the 50 countries collecting the most in taxes, 24/7 Wall St. reviewed data from the OECD, ranking countries by their 2019 tax revenue as a percent 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 almost right in between these extremes, at 24.5% in 2019. (These are the U.S. states collecting the most income tax per person.)

Though the U.S. ranks among the 50 countries collecting most in taxes, it has one of the lowest tax revenue to GDP ratio among OECD member states. The average tax revenue to GDP ratio among OECD member states is 33.8%. All Scandinavian countries rank among the top 10, each collecting the value of at least 40% of their GDP in taxes.

Click here for the nations collecting the most taxes