Saturday, 18 May 2013
1. Aruba – 58.95 percent for those with
income of at least $171,149
The country is known to have the highest standard of
living in the Caribbean. This Dutch territory has the highest income tax rate
in the world. It actually used to hover above 60 percent back in 2007. Married
individuals who meet the income requirement are charged a slightly lower 55.85
percent. The country also has a 25 percent tax on capital gains. The rate is
double than the average rate in the Caribbean, and especially astounding
considering the zero income tax regime in the Bahamas, Bermuda and Cayman
Islands.
2. Sweden – 56.6 percent for those with
income of at least $85,841
Sweden is a welfare state where citizens get free
education and subsidized healthcare. Everyone is also guaranteed a basic
pension. Even public transportation is subsidized. All these are the results of
an aggressive tax scheme by the Swedish government in which those with
extremely high incomes are levied a tax rate of 56.6 percent. As this rate will
only kick for those with income of $85,841, most Swedes do not worry about it
as it is way above the average income of $48,800. Sweden also has a 30 percent
tax on investment income, as well as significant rates for property holdings
and social security.
3. Denmark – 55.38 percent for those with
income of at least $70,633
This rate is actually an adjusted rate already, as the
top marginal rate used to be 62.3 percent in 2008. Denmark also taxes dividend income by 28
percent and capital gains by 42 percent. Even the Danish church is not exempt,
as they are liable for taxes ranging from 0.4 to 1.5 percent. Gifts to relatives over a certain threshold
amount are also subject to 15 percent tax.
4. Netherlands – 52 percent for those with
income of at least $70,090
The Netherlands has the highest tax rate in Western
Europe, where the regional average stands at 45.7 percent. Its government also
charges capital gains tax of 25 percent, land transfer tax of 6 percent and
inheritance tax of up to 40 percent. Average income in the country is $57,000.
5. Belgium – 50 percent for those with income
of at least $45,037
Belgium’s tax rate
is higher than the average for the region. It also charges a social security
rate of 13 percent for employees and 35 percent for employers, municipal taxes
of up to 11 percent, and capital gains tax of up to 33 percent. The country
actually has the highest tax and social security burden in the world, with
single taxpayers taking home less than 45 percent of their actual income. Those in the higher income brackets take home
less than 40 percent. Average income in the country is $45,037.
6. Austria – 50 percent for those with income
of at least $74,442
.Aside from the high income tax rate, Austria also has a social security rate of 18 percent,
bonus payments are charged 6 percent, and capital gains tax is at 25 percent.
Money stashed away in Swiss banks is also taxed through a special agreement
between the Swiss and Austrian governments.
7. Japan – 50 percent for those with income
of at least $228,880
Japan has the highest income tax rate in the whole of
Asia, where the average is only at 23 percent. Note however that the high rate
only kicks in at $228,880, which is an extremely high income level in a country
where the average income is $53,200.
8. United Kingdom – 50 percent for those with
income of at least $234,484
This will only last until April 2013, when the rate will
be cut to 45 percent. Those earning less than $14,300 are exempted from paying
taxes. Social security taxes can be as much as 14 percent, while capital gains
can reach 28 percent.
9. Finland – 49.2 percent for those with
income of at least $87,222
The top rate used to be 53.5 percent, but this was cut in
recent years. Municipal tax can be as much as 21.5 percent, and a church tax of
up to 2 percent. Capital gains can reach 28 percent. The government plans to
increase taxes in 2015, with the new rates targeting high income and pension
owners and those receiving inheritances above $1.3 million.
10. Ireland – 48 percent for those with
income of at least $40,696
The top marginal rate has been increasing steadily the
past few years, as it stood at only 45 percent in 2008. Social security tax is
at 4 percent. Taxes on gifts, inheritances and capital gains can reach as much
as 30 percent. It has the lowest corporate tax rate in Europe, however, at only
12.5 percent.
