Data on government sector receipts, and on taxes in particular, are basic inputs to most structural economic descriptions and economic analyses, and they are increasingly used in economic comparisons. This annual publication gives a conceptual framework to define which government receipts should be regarded as taxes. It presents a unique set of detailed and internationally comparable tax data in a common format for all OECD countries from 1965 onwards. This year’s edition includes a special feature on health taxes in OECD countries.
Revenue Statistics 2024
Health Taxes in OECD Countries
Revenue Statistics
Abstract
Executive Summary
In 2023, the average tax-to-GDP ratio of OECD countries declined by 0.1 percentage points (p.p.) to 33.9%. This was the second year in a row that the average tax-to-GDP ratio has declined slightly, although it remained above the level in 2019, prior to a challenging period for public finances in OECD countries that has included the COVID-19 pandemic, Russia’s illegal invasion of Ukraine and the highest level of inflation in OECD countries for 30 years. OECD countries continued to use tax policy to ease cost-of-living challenges in 2023 amid growing spending pressures related to long-term challenges such as climate change and population ageing, which will require higher revenues.
In this publication, taxes are defined as compulsory, unrequited payments to the general government or to a supranational authority. They are unrequited in that the benefits provided by governments to taxpayers are not normally allocated in proportion to their payments. Taxes are classified according to their base: income, profits and capital gains; payroll; property; goods and services; and other taxes. Compulsory social security contributions paid to general government are also treated as taxes. Revenues are analysed by level of government: federal or central; state; local; and social security funds. Detailed information on the classification of taxes is set out in the Interpretative Guide in Annex A.
Across OECD countries, tax-to-GDP ratios ranged from 17.7% in Mexico to 43.8% in France in 2023. Between 2022 and 2023, the OECD average tax-to-GDP ratio declined from 34.0% to 33.9%.
In 2023, tax-to-GDP ratios increased from the previous year in 18 of the 36 countries for which preliminary data is available, declined in 17 countries and remained unchanged in one.
The largest increase in 2023 was observed in Luxembourg, whose tax-to-GDP ratio rose by 2.7 p.p. due to higher revenues as a share of GDP from personal income tax (PIT) and social security contributions. The second-largest increase was in Colombia, where tax revenues rose by 2.6 p.p. as a result of higher revenues from corporate income tax (CIT).
The largest declines in the tax-to-GDP ratio in 2023 occurred in Chile and Korea (of 3.2 p.p. and 3.1 p.p. respectively). In both cases, this was primarily due to a decline in income tax revenues. The United States and Israel also recorded declines in their tax-to-GDP ratio larger than 2 p.p.
Over the longer term, 29 OECD countries reported higher tax-to-GDP ratios in 2023 than in 2010, with the largest increases in Japan (8.2 p.p.), the Slovak Republic (7.6 p.p.) and Greece (7.5 p.p.). Among the remaining nine countries, Ireland’s tax-to-GDP ratio was 5.8 p.p. lower in 2023 than in 2010 while Hungary’s was 2.6 p.p. lower.
In 2022, the latest year for which final tax revenue data is available for all OECD countries, social security contributions accounted for the largest share of tax revenues in the OECD, at just under one-quarter (24.8%), on average, while revenues from PIT accounted for the second-largest share, at 23.6%. VAT accounted for just over one-fifth of total revenues (20.8%), with other consumption taxes generating a further 10.8%. CIT accounted for 12.0% of total tax revenues in 2022, with property taxes (5.3%) and residual taxes accounting for the remainder.
Between 2021 and 2022, the average share of income tax revenues (PIT and CIT combined) in total tax revenues increased by 1.4 p.p. to 36.5%, with the share of CIT in total tax revenues increasing over this period while the share of PIT declined. In 2022, the average share of social security contributions in the OECD average tax structure fell by 0.8 p.p. while the share of tax revenues from taxes on goods and services decreased by 0.4 p.p.
On average, subnational governments received a lower share of tax revenues in 2022 than in 2021. The central government’s average share of revenues rose from 53.5% to 53.7% of general government revenue in federal countries and from 63.6% to 64.6% in unitary countries between 2021 and 2022. In federal countries, 17.8% of tax revenues were received at state level and 7.3% at local government level on average in 2022. At state level, the average share of tax revenues ranged from 1.9% in Austria to 38.9% in Canada, while at local government level it ranged from 1.8% in Mexico to 15.8% in Switzerland. In unitary countries, the share of local government revenues was 10.3% on average, ranging from 0.6% in Estonia to 35.1% in Sweden.
The Special Feature in this publication examines revenues from health taxes in OECD countries. Health taxes, defined by the World Health Organisation as ‘taxes levied on products that have a negative public health impact’, have emerged as a major focus of policy makers in public finances and health over the past two decades. This reflects the capacity of health taxes to meet two objectives: not only do they generate a modest but stable source of revenues to finance public spending but they have also been shown to be a cost-effective means of reducing consumption of unhealthy products and thus improving health outcomes. Although taxes on alcohol and tobacco are present in all OECD countries, taxes on sugar-sweetened beverages (SSBs) are relatively new and have not yet been implemented by all countries.
The Special Features uses granular data provided by countries for this edition of Revenue Statistics to examine revenues from excise taxes on alcohol, tobacco and SSBs between 2000 and 2022. Revenue data is a key input for designing and monitoring the effectiveness of health taxes, although revenue trends should be interpreted with caution as it may be difficult to clearly identify the underlying drivers. International comparison of revenue levels should also take into account differences in consumption patterns between countries.
On average across OECD countries, revenues from these three health taxes amounted to 0.74% of GDP and accounted for 2.24% of total tax revenues in 2022. In 27 of the 38 OECD countries, revenues from excise taxes on tobacco were the principal source of health tax revenues in that year. Revenues from health excise taxes have declined as a proportion of GDP between 2000 and 2022 on average across the OECD (especially since 2010), with the largest decline observed for excise taxes on alcohol.
