December 20, 2013
OECD: Government Tax Revenues are Improving
The Organization for Economic Cooperation and Development (OECD) has indicated that 30 of its developed-country members have seen their tax revenues continue to recover in 2013 after the 2008-2009 global financial crisis. While pre-crisis revenues accounted for roughly 35% of GDP, in 2013 it is at 34.6%, which indicates that revenues are in fact returning, albeit slowly, to past levels.
Revenues began to recover in 2011, but have continued to improve more and more each year, says the OECD. The largest increases were in countries such as Hungary, Greece, New Zealand, and Italy while the largest declines were in Israel, the U.K., and Portugal. It seems that northern European countries continue to have the largest share of revenues compared to their GDP, with Denmark, for example, equaling 48%. The United States, on the other hand, has had tax revenues increase much more slowly than other nations because it never implemented the stringent, and highly unpopular, austerity measures that its European counterparts did. Nevertheless, tax revenues are rising in the U.S. as well.
The OECD said that on the whole these increases are due to higher income tax rates and higher taxes on goods and services.