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There’s no denying that taxes in the United States can put a heavy toll on your income. In fact, America’s highest individual and corporate tax rates are higher than many other countries. To determine where the tax bite is lower, GOBankingRates used data from the tax advisory service KPMG on individual and corporate tax rates around the world.
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Find out which countries have lower tax rates than the United States
Last updated: April 28, 2021
Washington DC Capitol Building
US tax rates
In 2017, the highest marginal tax rate for individuals was 39.6% and, according to the Tax Foundation, affected individual taxpayers with incomes of $ 418,400 and above and married taxpayers with total incomes of $ 470,700 or more.
However, the Tax Reduction and Employment Act lowered the maximum rate to 37% in 2018. This rate applies to individual taxpayers with taxable income of $ 500,000 or more and to married couples who jointly submit income of $ 600,000 or more according to the tax foundation.
The highest corporate tax rate in the U.S. was 35% in 2017, but the tax law lowered the corporate tax rate to 21%, and it has remained that way ever since. Read on to see how these U.S. taxes compare to taxes in other countries.
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Santiago, Chile
Chile
Chile’s highest individual tax rate is not much lower than the highest US tax rate. However, like the US, Chile has a progressive tax rate and the lowest tax rate is 0%, according to KPMG. The lowest individual income tax rate in the United States is 10%. Chile is also one of those countries where residents pay less for health care than Americans.
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Mexico City
Mexico
America’s southern neighbors pay less individual and corporate taxes. Mexican residents also pay less for health care than Americans.
The story goes on
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Thailand
Thailand
The individual tax rate in Thailand is between 0% and 35%, which is only slightly lower than the highest individual US tax rate. According to KPMG, the income tax rate in Thailand was about 5 percentage points above the average rate in Asia.
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Canada Toronto
Canada
America’s northern neighbors are facing a minor tax bite. Canada’s highest individual tax rate is about 7 percentage points below the highest US tax rate. However, the lowest rate is 15% compared to 10% in America.
According to another GOBankingRates study, the country’s residents not only benefit from Canada’s lower tax rate, but also have a lower cost of living than Americans.
New Zealand
New Zealand
Although nearby Australia has a higher tax rate than the US, New Zealand taxpayers have a lower tax rate than Americans. Also, residents do not need to file an annual tax return if their income comes from employment, interest or dividends and the correct amount of tax was withheld during the year according to KPMG.
View over the Schlossplatz in Warsaw’s old town.
Poland
As one of the cheapest countries to live in, the highest individual and corporate tax rates in Poland are lower than in America. Poles also pay less taxes than many of their European neighbors.
Singapore
Singapore
This Asian country is more tax-friendly than the US. It is also considered one of the most notorious tax havens in the world. In addition, individual and corporate tax rates are below the average rates in Asia.
Czech Republic
Czech Republic
The Czech Republic has a flat tax rate of 15% on individual income. However, there is also a 7% solidarity tax on income.
Ukraine
Ukraine
This former Soviet republic has a lower individual income tax rate than the United States and the average tax rate in Europe. But its neighbor Russia has an even lower rate – 13%.
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Budapest, Hungary
Hungary
Hungary has one of the lowest corporate tax rates in the world, according to the Tax Foundation. It is also one of the countries with the lowest taxes for individuals.
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This article originally appeared on GOBankingRates.com: These 10 Countries Pay Less Taxes Than Americans