WHAT COUNTRY HAS THE HIGHEST INCOME TAX RATE?
Lawrence Agbo, writing in Vanguard, composed a list of the countries with the highest income tax rates. You can read the article at https://www.vanguardngr.com/2024/12/top-10-countries-with-the-highest-income-tax-rates/
Scandinavia took high honors, with Finland topping the list at 57.3% and Denmark coming in second at 55.9%. Austria, which is not a Scandinavian country, muscled into third place at 55%, followed by Sweden at 52.3%. Those countries offer rich social benefits that are unavailable here.
The United States did not make the Top Ten List, but should it have? As far as we are aware, the other countries have no state or local income taxes. If we consider state and local income taxes in addition to the federal income tax, the United States clocks in at 50.3% for high earners in California. That would come in seventh on Agbo’s list ahead of Belgium, Slovenia, Israel, and the Netherlands.
How do we get 50.3% when the top U.S. federal rate is 37% for married taxpayers with incomes of $751,600? The top personal income tax rate in California for high earners is 13.3%, according to H&R Block. Adding that rate to the federal rate of 37% gives us 50.3%.
For sure, few Americans ever reach the 50.3% bracket, and our state sales taxes tend to be lower than other countries’ VATs. However, Americans still encounter taxes that residents of other countries do not. For example, according to the Tax Foundation, eleven states have county- or city-level income taxes.[1] Property taxes in the United States, especially in New Jersey, are also high because they pay disproportionately for public safety, education, and local services. Thus, to say that Americans pay little tax compared to the rest of the world based on federal income tax alone is misleading. Americans pay plenty of taxes.
There is a better way. The FAIRtax eliminates federal income taxes, and nine states have no personal income tax. At least five more states have discussions underway about eliminating income taxes. If California were to join those fourteen states, it would go from the sixth-highest taxed jurisdiction in the world to one of the lowest. California’s economy, now the fifth largest in the world, would jump ahead of Japan’s to number four.
I would love to hear from you if you can demonstrate the true measure of your taxes and how it would put you ahead of Finland’s.
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🇺🇸 Call For Pictures & WriteUps - We need more of you to send in pictures and news. If you have something to share, please send your material to me, Jim.Bennett@FAIRtax.org, (908) 578-4975, or fax (908) 598-2888. When others see your activity, they are inspired, and the process snowballs. When the process snowballs, Congress Members, Senators, and even the President start to listen.