Highest tax wedge countries
The highest tax wedge in the OECD is Belgium at 52.7% of total labour cost for a single average worker, followed by Germany (47.9%) and Austria (47.2%). Continental European economies with large payroll-funded social insurance fill most of the top spots. The OECD average is 34.9%. Modelled averages — not tax advice.
Source: OECD Taxing Wages. Data as of June 2026 (OECD Taxing Wages, 2023 data year).
Tax wedge ranked, highest first
| # | Country | Tax wedge | Income tax | Employer SSC | Net take-home (USD PPP) |
|---|---|---|---|---|---|
| 1 | Belgium | 52.7% | 25.9% | 27.1% | $48,922 |
| 2 | Germany | 47.9% | 17% | 20% | $50,959 |
| 3 | Austria | 47.2% | 15% | 27.7% | $51,288 |
| 4 | France | 46.8% | 16.2% | 36.3% | $44,152 |
| 5 | Italy | 45.1% | 22.1% | 31.6% | $38,114 |
| 6 | Finland | 43.5% | 21.1% | 21.2% | $44,359 |
| 7 | Slovenia | 43.3% | 12.1% | 16.1% | $29,918 |
| 8 | Portugal | 42.3% | 17.6% | 23.8% | $29,328 |
| 9 | Sweden | 42.1% | 16.9% | 31.4% | $43,556 |
| 10 | Slovak Republic | 41.6% | 10.9% | 29.7% | $22,614 |
| 11 | Luxembourg | 41.3% | 20.9% | 13.8% | $55,929 |
| 12 | Hungary | 41.1% | 15% | 13% | $26,544 |
| 13 | Latvia | 41.1% | 16.6% | 23.6% | $25,533 |
| 14 | Spain | 40.2% | 15.6% | 30.4% | $38,064 |
| 15 | Czechia | 40.2% | 9% | 33.8% | $30,492 |
| 16 | Estonia | 39.4% | 17.3% | 33.8% | $29,254 |
| 17 | Lithuania | 38.9% | 18.3% | 1.8% | $28,683 |
| 18 | Greece | 38.5% | 10.9% | 22.3% | $32,983 |
| 19 | Türkiye | 38.4% | 12.6% | 17.5% | $33,314 |
| 20 | Denmark | 36.4% | 36% | 0.6% | $52,734 |
| 21 | Norway | 36.4% | 20.2% | 13% | $59,594 |
| 22 | Netherlands | 35.1% | 16.4% | 12% | $56,816 |
| 23 | Ireland | 35.1% | 24% | 11.1% | $55,475 |
| 24 | Poland | 34.3% | 5.7% | 16.4% | $32,636 |
| 25 | Japan | 33% | 7.9% | 15.6% | $41,562 |
| 26 | Canada | 31.9% | 19.2% | 9.2% | $54,408 |
| 27 | Iceland | 31.7% | 27.3% | 6.3% | $55,620 |
| 28 | United Kingdom | 31.3% | 14.8% | 11.2% | $52,790 |
| 29 | United States | 29.9% | 16.6% | 8.1% | $50,954 |
| 30 | Australia | 29.2% | 24.9% | 6% | $52,668 |
| 31 | Costa Rica | 28.6% | 0% | 25.2% | $24,740 |
| 32 | Korea | 24.6% | 6.8% | 11.1% | $55,956 |
| 33 | Switzerland | 23.5% | 12.2% | 6.4% | $81,465 |
| 34 | Israel | 23.2% | 10.8% | 5.7% | $39,975 |
| 35 | New Zealand | 21.1% | 21.1% | 0% | $40,381 |
| 36 | Mexico | 20% | 9.6% | 11.3% | $14,998 |
| 37 | Chile | 7.2% | 0.1% | 0% | $27,228 |
| 38 | Colombia | 0% | 0% | 0% | $16,615 |
Source: OECD Taxing Wages. Data as of June 2026 (OECD Taxing Wages, 2023 data year).
A high wedge isn't all income tax
Notice how often the income-tax column is modest even when the wedge is high — the difference is social-security contributions, especially the employer share that never appears on a payslip. For the opposite end, see the lowest tax wedge ranking; to isolate the employer burden, see highest employer social security.
Frequently asked questions
Which country has the highest tax wedge?
Belgium has the highest tax wedge in the OECD at 52.7% of total labour cost for a single average worker, ahead of Germany (47.9%) and Austria (47.2%). The top of the list is dominated by continental European economies with large social-insurance systems. The OECD average is 34.9%.
Why are tax wedges so high in continental Europe?
High-wedge countries fund generous social insurance — pensions, healthcare, unemployment and family benefits — largely through payroll-based social-security contributions split between employees and employers. A big employer contribution in particular pushes up the wedge without raising gross pay. Whether the wedge is 'worth it' depends on what the contributions buy and your own use of those services.
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Last updated: 2026-06-29