The world’s top 20 tax systems

London Bridge
By Isabelle Bell, CA Today

20 November 2015

The UK’s tax system is now ranked 15th in the world, while Qatar and UAE claimed the top spots, according to a new report.

The PwC and World Bank Group Paying Taxes study ranks countries based on how easy it is to pay taxes by looking at tax costs and the burden of compliance on businesses.

The UK’s ranking has gone up by one place since last year, largely due to the falling rate of corporation tax. This makes it the third-highest G20 country, behind Saudi Arabia (3) and Canada (9), but well ahead of Australia (42), the US (53) and China (132).

However, the report warned that the compliance burden for UK businesses has not eased and it still takes about 14 days for a medium-sized company to prepare, file and pay its eight different taxes.

Top 20 effective tax systems

1. Qatar, joint with UAE
3. Saudi Arabia
4. Hong Kong
5. Singapore
6. Ireland
7. Macedonia
8. Bahrain
9. Canada
11. Kuwait
12. Denmark
13. Mauritius
14. Norway
15. UK
16. Brunei Darussalam
17. Finland
18. Kazakhstan
19. Switzerland
20. South Africa

Kevin Nicholson, Head of Tax at PwC said that the UK could not afford to “sit still” on tax reform if the Government is to make the UK the most competitive G20 tax system.

He said: “The UK has a competitive tax system, but other countries continue to drive their own tax reform agenda.

“The fall in corporation tax is significant but is only part of a wider issue. Reducing the compliance burden is critical, particularly for small or medium sized businesses, where the time spent dealing with taxes can have a considerable impact.”

The report found that the Middle East region has the lowest total tax rate (24.2%), while South America has the highest at 55%. The UK’s total tax rate is 32%.

The African island nation of Comoros has the highest total tax rate at 216.5%, dwarfing the world’s smallest total tax rate of 8.5% of the South Pacific nation of Vanuatu.

Source: PwC


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