29/11/2011 - OECD countries acknowledge that taxes must play a role in the process of fiscal consolidation as they battle unprecedented budget deficits. New OECD data in the annual Revenue Statistics publication show that the majority of OECD governments have stabilised their tax to GDP, with the average ratio moving up slightly from 33.8% in 2009 to 33.9% (1) in 2010. That’s still down from 34.6% in 2008 and well below the most recent high point of 2007 when tax to GDP ratios averaged 35.2%.
Total tax revenue as percentage of GDP, 2009
Source: Revenue Statistics,1965-2010, 2011 Edition.
The underlying message from these comparisons is complex, as changes in tax revenues reflect not only changes in economic activity but also policy measures.
In those European countries most affected by the financial crisis and subsequent recession there was an initial sharp fall in tax revenues but then a small recovery in the tax to GDP ratio in 2010.
The data collected also show that in a period when all levels of government have seen pressure on expenditure and revenues, the average tax ratio for state, regional and local governments has remained steady since 2007 while that for central government has declined.
In the latest edition:
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For further information please contact OECD’s Centre for Tax Policy, Jeffrey Owens at + 331 45 24 91 08 or Stephen Matthews at + 331 45 24 93 22.
1. Calculated by applying the unweighted average percentage change for 2009 in the 30 countries providing data for that year to the overall average tax to GDP ratio for 2009.