![]() ![]() This is because all OECD countries, except the United States, levy value-added taxes (VAT) usually at relatively high rates. Taxes on goods and services accounted for only 16.9 percent of total tax revenue in the United States, compared to 32.1 percent in the OECD. The United States relies much less on consumption taxes than other OECD countries. The OECD on average raised 5.6 percent of total tax revenue from property taxes, compared to 11.9 percent in the United States. and reduces the share of corporate tax revenue. approach to taxing business income boosts the share of tax revenue from individual income taxes in the U.S. Relative to other OECD countries, the U.S. This is partially because more than half of business income in the United States is reported on individual tax returns. While OECD countries on average raised 24 percent of total tax revenue from individual income taxes, the share in the United States was 41.1 percent, a difference of 17.1 percentage points. Corporate income taxes accounted for 5.1 percent of total tax revenue in 2020, the third year after passage of the Tax Cuts and Jobs Act, and just 0.6 percentage points less than in 2017.Ĭompared to the OECD average, the United States relies significantly more on individual income taxes and property taxes. Social insurance taxes (including payroll taxes for Social Security and Medicare) made up the second-largest share, at 24.8 percent, followed by consumption taxes, at 16.9 percent, and property taxes, at 11.9 percent. In the United States, individual income taxes (federal, state, and local) were the primary source of tax revenue in 2020, at 41.1 percent of total tax revenue. ![]() This is especially important as the economic recovery from the pandemic continues.
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