Countries have made progress towards mobilising domestic financing for development in the 21st century, a working paper published by the Organisation for Economic Cooperation and Development (OECD) has found.
Compared to 2000, levels of tax revenues are now higher and more even across countries. The paper also found countries with the lowest revenues have experienced the largest increase in their tax-to-GDP ratios.
Key findings from the working paper included:
- Across the 80 countries looked at, tax-to-GDP ratios range from 10.8% to 45.9%. The median tax-to-GDP ratio is 26.2%
- Since 2000, three-quarters of the countries have increase their tax-to-GDP ratio.
- In Africa and LAC, taxes on goods and services and corporate income taxes are particularly important as a share of revenues. Social security combinations and personal income taxes form the highest shares of tax revenue in most OECD countries.
- Since 2000, VAT has become increasingly significant in more than three-quarters of countries, in many cases, with corresponding falls in the share of income taxation or taxes on other goods and services. The exceptions are the quarter of countries with the highest increase in their tax-to-GDP ratios, which recorded strong increases in most or all major tax types.
Global Revenue Statistics Database
The working paper took its findings from the OECD’s Global Revenue Statistics Database, which provides country-specific indicators on tax levels and structures for 80 countries.
The database intends to support global efforts to raise domestic revenues for sustainable development by contributing to the Sustainable Development Goals and Addis Ababa Action Agenda.
The database uses information from the OECD’s four annual Revenue Statistics publications, which provide insights on tax systems and revenue priorities in African, Asian, Latin American and Caribbean (LAC), and OECD countries. The Revenue Statistics publications are based on the OECD standard and are produced with financial support from the EU.