DENMARK KEEPS WORLD TAX TITLE
December 3, 2009
In the tug-of-war between Sweden and Denmark for the dubious honor of having the world's highest taxes, Denmark has held on to the title, according to the latest Organization for Economic Co-operation and Development (OECD) report covering 2008.
- With an average tax rate of 48.3 percent, Denmark edges out its Scandinavian neighbor by more than a full percentage point; Sweden comes in at 47.1 percent.
- The average tax burden is calculated by the OECD as a proportion of a country's gross domestic product and is referred to as the "tax to GDP ratio."
- Denmark also had the highest ratio in 2007 at 48.9 percent.
To lower the nation's taxes to the European Union (EU) average of 39.7 percent in 2010, the Tax Ministry would have to reduce Denmark's annual tax intake by 150 billion kroner next year. Tax Minister Kristian Jensen says he has no wish for Denmark to hold first place in this unenviable category.
He however adds that the country was facing the challenge of keeping its economy afloat during the financial crisis.
He also argues that several other factors needed to be considered when determining a real tax burden, such as how much money residents of other countries pay for health care and to send their children to school and day care.
Source: Observers, "Denmark Keeps World Tax Title," Copenhagen Post, November 27, 2009.
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