The highest-earning Americans pay the most in combined federal, state and local taxes, the
Corporation tax is the tax that companies pay on their profits. Ireland has been reaping a corporation tax bonanza as reforms to global rules mean major US companies are choosing to pay tax on their international profits in the country. The best known of those is Apple, which has said it is Ireland's largest taxpayer.
England, Germany, and Ireland are among the top tax havens on the continent. Switzerland's financial secrecy has made it one of the world's top places to store cash.
The highest-earning Americans pay the most in combined federal, state and local taxes, the Tax Foundation noted. As a group, the top quintile — those earning $130,001 or more annually — paid $3.23 trillion in taxes, compared with $142 billion for the bottom quintile, or those earning less than $25,000.
This box is based on OECD data from November 2022 . While the UK tax burden is currently high by historical standards, it has remained below the average across other advanced economies.
The highest taxpayers in Britain include a scrap metal dealer, an athleisure tycoon from Bromsgrove, JK Rowling, the boss of Wetherspoon, Sting and the Duke of Westminster.
“Income tax rates are broadly similar at 20% / 41% in Republic of Ireland and 20% / 40% in the UK. One significant difference is the treatment of dividend income.”
The first part of your income, up to a certain amount, is taxed at 20%. This is known as the standard rate of tax and the amount that it applies to is known as the standard rate tax band. The remainder of your income is taxed at the higher rate of tax, 40%.
The highest labour cost in Europe in Norway
Of the countries covered by Eurostat's data the highest labour cost was in Norway (55.6 euros), in Luxembourg (50.7) and Iceland (48.4). The lowest hourly labour cost was in Bulgaria (8.2 euros) and in Romania (9.5).
In Ireland, low earners pay an effective rate of 16.72% tax, average earners pay 26.66%, and high earners pay 36.02%. Of these, only the high earners scraped into the top 10 of the highest effective tax rate across the EU.
Subsidies. As we explained at the start of this article, Government taxation is a major reason why things are so expensive in Ireland. However sometimes the opposite - government subsidies - or rather a lack of them, can be the reason.
Ireland's taxation system is distinctive for its low headline rate of corporation tax at 12.5% (for trading income), which is half the OECD average of 24.9%. While Ireland's corporate tax is only 16% of Total Net Revenues (see above), Ireland's corporate tax system is a central part of Ireland's economic model.
Germany. Basic rates of tax are around the same as in Britain (ranging from 19% to a top rate of 45%), but workers have to pay an extra 10% for state pensions, 8% for health, 1.5% for unemployment cover and 1% for care insurance.
"In the UK, the 45% top rate of tax kicks in at an income level of around $250,000 (£151,000) compared to Italy where the top rate of 43% comes in at $125,000," says Ben Wilkins, a tax partner at PWC.
The United Kingdom has taxes that are marginally more demanding than those of the United States. On the other hand, the scope and availability of social services in the United States are significantly narrower than in the United Kingdom.
In fact, the average American household earns a median income of under $70,000, but in some places, the top 1% can earn as much as $955,000. Those annual earnings can seem far out of reach in a country where less than 10% of all households earn more than $200,000, according to the U.S. Census Bureau.
Supporters of the progressive system claim that higher salaries enable affluent people to pay higher taxes and that this is the fairest system because it lessens the tax burden of the poor.
While Ireland has been considered a tax haven by many for decades now, the global tax system that Ireland depends on to incentivize multinational corporations to move there is receiving an overhaul by a coalition of 130 nations.
The highest standard VAT (Value Added Tax) rate in the world is 27% in Hungary. Some other countries, such as Sweden, have a standard VAT rate of 25%.
The European nation of Switzerland is considered to be an international tax haven due to low tax levels and privacy laws. Switzerland also has a history of favorable tax treaties, stable politics, and a wealth of advisors.
Gibraltar. The British Overseas Territory of Gibraltar is another one of the few European countries with no tax levied on the worldwide personal income of its residents and non-residents who do business there.