Tax policy analysis

Taxing Wages: tax burden trends between 2000 and 2014

 

The evolution of the tax wedge as percentage of total labour cost over the period 2000 to 2014 for the single worker on average earnings and on the one earner married couple with two children on average earnings is presented in linked tables “Tax burden trends 2000-2014_single” and “Tax burden trends 2000-2014_one earner couple with two children".

The OECD average tax wedge declined between 2000 and 2014 for both of the selected household types. There were 10 OECD countries with a reduction of more than 5 percentage points between 2000 and 2014 for at least one of the two family types; Australia, Denmark, Hungary, Ireland, Israel, New Zealand and Sweden.

Single average worker

  • The average OECD tax wedge declined by 0.7 percentage points from 36.7% to 36.0%.
  • There were declines in 21 OECD countries over the 14 years and increases in 12 (Austria, the Czech Republic, Greece, Iceland, Italy, Japan, Korea, Luxembourg, Mexico, Portugal, Spain and the United States).
  • The largest decline was for 9 percentage points in Israel.
  • There was also a decline of over 7 percentage points in Sweden.
  • There was a reduction in the tax wedge of more than 5 percentage points in 2 other countries (Denmark and Hungary).

One earner married couple with two children on average earnings

  • The average OECD tax wedge declined by 0.8 percentage points from 27.7% to 26.9%.
  • There were declines in 21 OECD countries over the 14 years and increases in 13 (Austria, Chile, the Czech Republic, Estonia, Greece, Iceland, Japan, Korea, Luxembourg, Mexico, the Netherlands, Norway and Spain).
  • The largest decline in the tax wedge was for 9.8 percentage points in New Zealand.
  • There was also decline of over 9 percentage points in Hungary.
  • There was a reduction in the tax wedge of more than 5 percentage points in 4 other countries (Australia, Ireland, Israel and Sweden).

 

Downloadable tables/figures

Tax burden trends 2000-2014_single  

Tax burden trends 2000-2014_one earner couple with two children

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