A new report from Eurostat shows that taxes in the average EU nation confiscate nearly 41 percent of national economic output. Sweden and Denmark compete for the dubious honor of imposing the most onerous tax burden. Flat tax nations in Eastern Europe have the lowest tax burdens, and Ireland also scores well. For what it’s worth, the tax burden in the United States is lower than it is in any EU nation, almost certainly because America is not burdened with a value‐added tax. Tax-news.com reports on the Eurostat findings:
The European Statistics Office (Eurostat) on Tuesday published figures examining taxation in the EU from 1995 to 2005. According to the Eurostat report, in 2005, tax revenue in the EU27 stood at 40.8% of GDP, compared with 40.4% in 2004. In the euro area, tax revenue was 41.2% of GDP in 2005, compared to 40.9% in 2004. Over a longer period, tax revenue as a percentage of GDP in both the EU25 and the euro area were in 2005 slightly below the levels recorded in 1995. …In 2005, Sweden (52.1%) recorded the highest ratio, followed by Denmark (51.2%), Belgium (47.7%), France (45.8%), Finland (44.0%) and Austria (43.6%). The lowest ratios were observed in Romania (28.8%), Lithuania (29.2%), Slovakia (29.5%), Latvia (29.6%), Estonia (31.0%) and Ireland (32.2%). …With regard to taxes on income and wealth, Denmark (31.2%), Sweden (20.1%) and Finland (17.5%) recorded the highest ratios to GDP, compared to an EU27 average of 12.8%, while Romania (5.3%), Bulgaria and Slovakia (both 6.1%) registered the lowest ratios. For actual social contributions, the highest ratios to GDP were observed in Germany (16.7%), France (16.4%) and the Czech Republic (15.1%), compared to an EU27 average of 13.0%, whereas Denmark (1.1%), Ireland (4.8%) and Malta (7.2%) recorded the lowest ratios.