European countries, on average, have a tax burden of 43.3 percent of Gross Domestic Product (GDP), nearly twice the average rate for the major emerging BRIC economies (21.8 percent), a research of UHY, the international accounting and consultancy network, shows.
Romania has a tax burden of 28.5 percent of GDP, up by 24 percent than the average rate for the major emerging BRIC economies.
According to the study, the taxes imposed by the Romanian Government are also higher than the average at the global level (28.2 percent).
UHY studied 34 countries around the world, calculating what percentage of that country’s GDP is taken by the Government in tax, Romania ranking 17th according to the research.
Denmark came top of the study with the Government’s tax take representing 53.5 percent of total GDP, a position it also occupied in a previous UHY study on the same topic conducted in 2015, with a rate of 48.6 percent.
“Developed economies need to investigate ways of lowering the tax burden for businesses or they may find increasing competition from more dynamic emerging countries. Lower personal and business taxes can help economies spur growth and create incentives, particularly for investors and larger, more globally-focused businesses,” Bernard Fay, Chairman of UHY, commented.
Recently, the European Commission suggested that EU countries may have to consider changing tax policies to help fill the EUR 15 billion annual budget hole left by the UK’s Brexit. These could include proposals such as using a portion of corporate tax receipts from national treasuries for the EU’s common funds and programmes.