{"id":1257,"date":"2022-08-25T12:25:17","date_gmt":"2022-08-25T11:25:17","guid":{"rendered":"https:\/\/accountants247glasgowsouth.co.uk\/?p=1257"},"modified":"2022-08-25T12:25:17","modified_gmt":"2022-08-25T11:25:17","slug":"tax-wedge","status":"publish","type":"post","link":"https:\/\/accountants247glasgowsouth.co.uk\/?p=1257","title":{"rendered":"How much is our work taxed in the UK compared to other countries?"},"content":{"rendered":"\n

The OECD recently released its latest Taxing Wages 2022 report, and it\u2019s interesting to see where the UK falls compared to other developed nations when it comes to tax. One of the purposes of this particular paper was to look at the impact of Covid-19 on how workers were taxed across 38 different nations \u2013 and it makes for interesting reading!<\/p>\n\n\n\n

\"work<\/figure>\n\n\n\n

The UK\u2019s \u2018tax wedge\u2019 falls just below the OECD average<\/strong><\/p>\n\n\n\n

The \u2018tax wedge\u2019 is the gap between what the employer pays for labour and what the worker takes home, and there\u2019s an enormous range between nations. In Belgium, workers lose 52.6% of their income to taxes, while in Colombia it\u2019s zero.<\/p>\n\n\n\n

Here in the UK, the tax wedge in 2021 was 31.3%, only marginally lower than the OECD average of 34.6%. The tax wedge figures for other European nations are generally higher, with countries like France and Germany both promoting a \u2018high taxation and high public spending\u2019 approach to providing state welfare.<\/p>\n\n\n\n

In the UK, however, the current Conservative government has habitually aimed for a \u2018low tax, high growth\u2019 maxim. Good news for business investment and personal wealth management \u2013 not so great when it comes to finding the funds to get the UK out of austerity.<\/p>\n\n\n\n

Interestingly, our Commonwealth partners, Australia and New Zealand, both have much smaller tax wedges. Australia\u2019s main tax wedge was 27.1% and Kiwis only paid 19.4%!<\/p>\n\n\n\n

Here are a few other countries\u2019 tax wedge numbers, to put things in perspective. <\/p>\n\n\n\n

2021 tax wedge by country<\/strong><\/p>\n\n\n\n