Fact: Americans Don’t Pay the Highest Taxes
If you had to cut a check to Uncle Sam this Tax Day, you might take a little solace in the news that, well, it could have been a lot worse if you lived elsewhere.
According to a new report by The Organisation for Economic Co-operation and Development, the United States has one of the lightest tax burdens in the developed world: Out of the 34 countries ranked, America came in 25th place.
The report calculates the tax burden by taking the total taxes paid by employers and employees, minus any tax benefits they receive, and divided by the total labor costs of the employer. The average individual tax burden for single, childless workers around the globe comes in at close to 36%—but the U.S. comes in at around 31%, on par with countries like Canada and Japan.
Other nations face much higher tax bills each year: Belgium’s tax burden came in at an average of 55.8% (!), while Germany is close behind at 49.3%. On the other side of the spectrum: New Zealand’s tax burden is just shy of 17%, and Chile’s tax burden is a mere 7%.
The report revealed that overall, however, income tax rates have surged in 25 out of the 34 countries surveyed—and Americans were hit with one of the largest jumps around the globe this year, thanks to the expiration of a temporary reduction in Social Security taxes.
Paid a hefty tax bill this year—but don’t exactly want to move to Chile to lighten your load? Set yourself up for a better 2015 with our guide to getting ahead in the new tax season.