What precisely are corporate and personal income taxes?
And what is the income tax rate by country?
Enjoy our map and discover the numbers yourself:
This Map Shows the Income Tax Rate by Country
With so many tax rates around the world, we couldn’t help ourselves creating a global map that explains it all in a single image. You can see personal and corporate tax rates for every country on Earth.
Personal tax is the tax that an individual pays on income that is generated from salary, rent, and interest. Taxpayers from this group can be further separated into resident and non-resident varieties. Non-residents pay taxes on earnings from sources in the country, while residents pay taxes on profits from sources in the country, as well as on the segment of their income.
Corporate tax is what businesses have to deal with; corporations are taxed based on the profits made during the financial year. The exact percentage depends on the country where the business is located.
Did you know that those who earn over $372,950 have an average personal tax rate of 35% and that an average corporation pays the same percentage in taxes? In order to find out more about personal and corporate taxes in different parts of the world, in this article, we’ll discuss income tax rates by country.
High tax rates are a burden for households and businesses. They eat up budgets, they decrease profits, and there is no way to move around them.
There are a few countries with 0% tax rates. However, taxes are inevitable in most parts of the world.
In this article, we’ll find out which countries have the highest taxes for people and businesses.
Corporate Tax Rate by Country
We’ll kick off our list with the highest corporate tax rate countries in the world.
1. The corporate tax rate in Puerto Rico is 39%.
(Source: Trading Economics)
While officially an unincorporated territory of the US, Puerto Rico is in charge of its own tax regulation. The country’s corporate tax rate graph looks a bit like a rollercoaster, with its average sitting at 37.71% in 2004, at 39% in 2005, and at 30% in 2012.
A corporation is subject to regular income taxes at an average rate of 39% on taxable income that exceeds $275,000, which makes it the highest corporate tax rate in the world. Some corporations may qualify for the “Pioneer Industries” program and pay 0-1% in taxes.
The country’s accounting period starts from the 1st of July and ends on the 30th of June. According to Deloitte, progressive rates are imposed up to 33%, while the companies that report over $500,000 in taxable income pay a surtax of 5%.
2. The corporate tax rate in Suriname is 36%.
(Source: Trading Economics)
Suriname holds the 2nd spot on the list of countries with the highest taxes, at least when it comes to business operations.
This country’s corporate tax is calculated based on an organization’s net profits, rather than revenue. Suriname’s corporate tax has a flat rate of 38%. The tax paid on dividends that shareholders receive is at 25%. On the bright side, all operating costs are deductible, and large investors can receive special treatment when it comes to tax payments.
Corporate taxes in Suriname are progressive, ranging from 8-38%.
3. The corporate tax rate in Argentina is 35%.
(Source: Trading Economics)
The data on world corporate tax rates shows that the corporate tax rate in Argentina holds the same value as 20 years ago: it averaged at 34.82% from 1997 until 2018, reaching 35% in 1999; the same value it holds today.
While personal income tax in the country is taxed progressively, the corporate tax in Argentina has a flat rate of 35%. Resident companies (incorporated in Argentina) and foreign branches currently have an income tax rate of 30%, which will be reduced to 25% starting in 2020, Deloitte points out.
4. The corporate tax rate in Chad is 35%.
(Source: Trading Economics)
Another one of the highest taxed nations, Chad-based companies are only subject to paying taxes on profits generated in the country. This also means that foreign charges and losses are not a basis for a tax deduction.
The country has different corporate tax brackets; companies earning 50-500 million XAF ($85,000-850,000) fall into the simplified bracket, while those who earn more are taxed at a normal rate of 35%. Those earning less than 50 million XAF pay corporate taxes based on a flat monthly rate.
Based on the recent corporate tax rate by country numbers, taxes in Chad vary based on the sector; for public institutions, it is at 25%, while businesses dealing with hydrocarbons pay up to 40%.
5. The corporate tax rate in Congo is 35%.
(Source: Trading Economics)
Congo is the poorest country in the world. Its corporate and private income taxes are both based on profits realized by a company or an individual that carries out any operational activity in the country.
Even though it shares one of the highest tax rates in the world with 9 other nations, Congo’s tax rates are not so terrible for every business; progressive tax rates range from 1-35%, depending on the sector and income of the company.
Companies who’ve reported losses for 2 financial years in a row pay a corporate tax of just 2% of their income, while foreign companies and those dealing with oil pay a tax of 35%.
6. The corporate tax rate in Equatorial Guinea is 35%.
(Source: Trading Economics)
Tax for Equatorial Guinea is based on a company’s net income during a given financial year. The country’s corporate tax is progressive, climbing up to 35%, which makes it one of the members of the top 10 highest tax burden by country club.
The corporate tax rate in Equatorial Guinea had an average value of 33.46% from 2004 until 2016, with the lowest point on the graph reaching 25% in 2005.
The minimum company tax is 3% of the preceding year’s turnover. The tax on businesses dealing with oil is at 25%.
7. The corporate tax rate in Guam is 35%.
(Source: Trading Economics)
Guam is another unincorporated US territory that has an independent taxation system. It is also one of the answers to the question “What country pays the most taxes?”
The corporate tax is progressive, depending on the net income of the business in question:
- Organizations that earn up to $50,000 have a corporate tax rate of 15%.
- Those earning $50,000-75,000 face a corporate tax rate of 25%.
- Businesses earning $75,000-100,000 pay 34% of the profits in taxes.
- Those making $100,000-335,000 pay 39% in taxes.
- Companies making $335-10 million pay 34%.
- The companies that make $10-15 million pay 35%.
- Companies making $15-18.3 million pay 38%.
- Organizations that earn over $18.3 million face a corporate tax rate of 35%.
8. The corporate tax rate in Guinea is 35%.
(Source: Trading Economics)
The average tax rate in Guinea (not to be mistaken for Equitorial Guinea) was 35.00% from 2004 until 2016, which is one of the highest corporate income tax rates by country, shared by the majority of countries on this list.
The corporate tax is non-progressive, with the exception of mining companies that pay 30% of their income in taxes. The overall tax collections amount to 9.6% of total national income, which is not an insignificant amount.
9. The corporate tax rate in Malta is 35%.
(Source: Trading Economics)
Malta is another country that shares the 35% corporate tax. Businesses registered in this island country pay taxes on their global income, rather than just the in-country profits. At 35%, the Maltese corporate tax rate is significantly above the EU tax rate of 21.3%.
While personal income is taxed progressively, the corporate tax rate in Malta is fixed.
10. The corporate tax rate in Sudan is 35%.
(Source: Trading Economics)
Opposite to South Sudan that has a progressive tax payment system, Sudan-based businesses pay a flat rate of 35%. Even the companies exempt from taxes have to chip in, with a 5% social development fee, corporate tax rate by country data shows.
In Sudan, the corporate tax rate had an average value of 27.73% from 2006 until 2016. The rate reached 35% in 2006, while the lowest point was in 2008, at just 15.00%.
Personal Income Tax Rate by Country
We’ve examined the corporate tax burden in different parts of the world. Now let’s take a look at households.
1. The personal income tax rate in Chad is 60%.
(Source: Trading Economics)
In the Republic of Chad, the personal income tax rate averaged at 60% from 2013 until 2016, keeping the same average in 2019 and earning this country the premier spot on the list of the highest taxed countries when it comes to personal income.
A resident of Chad is subject to the country’s personal income tax on their worldwide income. The average citizen of Chad earns just around $740.00 per year or $14.23 per week, which makes Chad one of the lowest income countries in the world.
As if this isn’t enough, mobile internet charges in Chad are among the most expensive on Earth.
2. The personal income tax rate in Ivory Coast is 60%.
(Source: Trading Economics)
Ivory Coast residents are subject to 2 types of personal taxes; specific direct income tax, which depends on the type of revenue, as well as to the country’s general income tax. The tax rate of 60% is expected to remain the same throughout 2020.
Based on the last year’s income tax rates by country figures, we found that Ivory Coast had a Gross Domestic Product of $1,692.5 per capita, while the average income per person is $640.
3. The personal income tax rate in Aruba is 59%.
(Source: Trading Economics)
If an individual is a citizen of Aruba, they are subject to personal income tax on their worldwide income, while non-residents of the country pay specific taxes, such as income from their employment and real estate taxes for properties situated in Aruba.
The personal income tax for Aruba has a progressive structure. According to the personal income tax rate by country data, the personal income tax rate had an average value of 59.22% from 2004 until 2018.
According to older data, the residents of Aruba have an average monthly employment income of $1,543 per person. The lowest earners make $562 per month, while the highest pays sit at around $2,778.
4. The personal income tax rate in Sweden is 57.2%.
(Source: Trading Economics)
Sweden, the country famous for its quality of life, has one of the highest taxes in the world when it comes to personal income. This country’s average for the period from 1995 until 2018 was 56.78%, with residents paying national and municipal income taxes.
Municipal tax is charged at a flat rate which differs from one community to another, but it is commonly between 29 and 34%. The national tax stands at a rate of 20 to 25%, based on how high your income is.
The average household income in Sweden is $31,287 per year.
5. The personal income tax rate in Japan is 55.95%.
(Source: Trading Economics)
According to the latest figures on income tax rates by country, the Japanese need to dedicate a large sum of their income to taxes. The personal income tax rate was at an average of 51.36% from 2004 until 2018.
The average household income in Japan is at 5,602,000 yen, which translates to $49,639.
6. The personal income tax rate in Denmark is 55.8%.
(Source: Trading Economics)
The Danish personal income tax rate had an average value of 60.45% in the period between 1995 and 2018, reaching 65.9% in 1997.
The average Denmark tax rate percentage is high, and it stems from a very complex taxation system. The taxation charges 8% of the income for the labor market endowment purposes, 2% for health endowment, bracket tax that ranges from 10-15%, plus municipal taxes that average at 24.9%. A church tax of 0.69% is also added to the total.
The average annual salary in Denmark is about $43,000. An average Danish household is left with around $29,606 of disposable income per year, per capita.
7. The personal income tax rate in Austria is 55%.
(Source: Trading Economics)
According to the personal income tax rate by country facts, a resident of Austria is subject to Austrian income tax on their worldwide income, while non-residents are taxed only on the income made in the country.
The personal income tax rate was at an average of 50.63% from 1995 until 2018.
The average Austrian household has $33,541 in disposable income per year, per capita.
8. The personal income tax rate in Belgium is 53.7%.
(Source: Trading Economics)
Income tax is unavoidable for those who have settled in Belgium, or for those who made some kind of financial interest in the country, regardless of their nationality. Citizens of Belgium are taxed on their worldwide income, while non-citizens are taxed only on the income that originated within the country.
Belgian personal income tax rate averaged at 55.81% for the period from 1995 until 2018.
Looking for data on personal income taxes by country, we revealed that the average disposable household income per capita is at $30,364 a year, over $3,000 less than the OECD average of $33,604.
9. The personal income tax rate in the Netherlands is 51.75.
(Source: Trading Economics)
The Netherlands taxes its taxpayers on their worldwide income; non-citizens are being taxed only on income sourced in the Netherlands.
The country’s personal income tax rate had an average value of 53.91% from 1995 until 2019, which, if it still were at the same level, would rank it even higher on our list of the highest individual tax rates by country.
The average household in the Netherlands has a per capita disposable income of $29,333, per year.
10. The personal income tax rate in Finland is 51.6%.
(Source: Trading Economics)
Finland taxes citizens on their worldwide income. The income earned by citizens is taxed at progressive tax rates for the national tax, depending on the amount of money earned, and a flat tax rate for municipal tax.
The personal income tax rate averaged 52.96% from 1995 to 2016.
Concluding our list of countries by income tax, we find that the average household disposable income in Finland is at $29,943, per capita.
Conclusion
As our list of income tax rates by country statistics shows, the leading 20 countries with the highest corporate and personal income tax rates cover every area of the world, even though unequally.
South America and Africa lead the way when it comes to corporate taxes, while European countries make the majority of those that have the highest personal tax rates.
Good luck to those looking to start a business or move to one of the countries listed.