The World Economic Forum’s latest Global Competitiveness Report was released recently, offering a yearly update on the state of the world’s economies.
To measure it they use the World Bank’s “total tax rate” — here’s what it uses to work it out:
The total amount of taxes is the sum of five different types of taxes and contributions payable after accounting for deductions and exemptions: profit or corporate income tax, social contributions and labor taxes paid by the employer, property taxes, turnover taxes, and other small taxes.
So it includes any taxes on labour that fall on the employer, but not ones like income tax that fall on the employee.
19. Spain: 58.2%. Though it comes in at number 19, Spain is only third of the five large European countries — two other sneak in ahead, with higher rates for businesses.
18. India: 61.7%. Finance minister Arun Jaitley aims to cut India’s corporate tax level by a little more than five percentage points, down to 25% over four years.
17. Tunisia: 62.4%. Though some other nations further south have steeper rates, Tunisia’s total tax rate is the second-highest in north Africa.
16. Benin: 63.3%. Though the World Bank says the country’s corporate income tax only runs to 15.9%, a bundle of other taxes raises the total rate imposed on businesses significantly.
15. Gambia: 63.3%. Without major natural resources, Gambia is among the poorest nations on earth. Taxes on turnover instead of profit raise rates for businesses significantly.
14. Chad: 63.5%. Like Gambia, chad relies on agriculture and is extremely poor. It taxes 1.5% of turnover or 40% or profits, based on which is higher.
13. China: 64.6%. Like other countries on the list, China levies some taxes on the turnover of companies instead of their profit.
12. Italy: 65.4%. The country is well known for its higher tax rates but gets beaten to the number 1 spot in Europe by another country.
11. Venezuela: 65.5%. The govt of Venezuela pursued a higher-tax model, with dramatic increases in taxes for foreign oil companies under former President Hugo Chavez.
10. Nicaragua: 65.8%. In 2012 the International Monetary Fund (IMF) suggested that the country decrease the complexity of its corporate tax system.
9. France: 66.6%. The country tops the ranks for Europe, though the current government has pledged to reform the system and cut corporate taxes.
8. Guinea: 68.3%. Most of Guinea’s corporate taxes are paid through a flat-rate tax on turnover from the previous year.
7. Brazil: 69%. Last year Latin America’s biggest economy eliminated a 20% tax on business payrolls as part of an effort to reform its system.
6. Mauritania: 71.3%. In 2013, this agriculture-dependent country brought in a withholding tax of 15% to stop people moving payments to non-residents.
5. Algeria: 72.7%. Algeria has the highest total tax rate of any African country.
4. Colombia: 75.4%. The country brought in a new wealth tax — though it’s fourth in the world, it only comes third in Latin America for its total tax rate.
3. Tajikistan: 80.9%. The central Asian country has a 2% statutory tax rate on all turnover, which takes out a major chunk of a company’s average profits.
2. Bolivia: 83.7%. Bolivia’s 3% tax on transactions wipes out 60% of company profits, before other taxes are taken into account. But it still loses out to one more Latin American country.
1. Argentina: 137.3%. Astonishingly, Argentina’s total tax cost is judged to be over 100% of corporate profits. The country’s turnover tax alone eats up nearly 90%, before taxes on salaries and financial transactions are taken into account.
