Which countries have the highest top tax rates?

A top rate of 50% would be above the OECD average but Denmark, Sweden, Belgium, Spain and the Netherlands all have higher rates.

Based on the neuralgic reaction of some business leaders and politicians to Labour's proposal to reintroduce the 50p tax rate, you might assume that the UK will become a pariah state if the measure is introduced. But how radical a move would it really be? For comparison, I've listed the top income tax rates (as of 2012) in the rest of the OECD below. 

As the figures show, while a top rate of 50 per cent would be significantly higher than the average of 42.5 per cent it is far from the highest. Denmark, Sweden and Belgium (hardly socialist backwaters) are among the six countries with higher rates, while Austria and Japan also have a top rate of 50p. 

And while plenty have accused Labour of "returning to the 1970s", a top rate of 50 per cent would be far from the top rate of 83 per cent (98 per cent on "unearned income") seen under Jim Callaghan. Even Margaret Thatcher managed to live with a top rate of 60 per cent for nine years of her premiership before Nigel Lawson reduced it to 40 per cent in his 1988 Budget. And, mercifully for the rich, Ed Balls has already said that there is "absolutely" no chance of Labour raising the rate beyond 50p. 

Top marginal tax rate

Denmark 60.2%

Sweden 56.6%

Belgium 53.7% 

Spain 52.0%

Netherlands 52.0% 

France 50.7%

Austria 50.0%

Japan 50.0%

Greece 49.0%

Finland 49.0%

Portugal 49.0%

Italy 48.6% 

Canada 48.0%

Ireland 48.0%

Israel 48.0% 

Australia 47.5% 

Iceland 46.2% 

United States 41.9% 

South Korea 41.8% 

Switzerland 41.7% 

Luxembourg 41.3%

Slovenia 41.0% 

Chile 40.0% 

Norway 40.0% 

Turkey 35.7% 

New Zealand 33.0%

Poland 32.0% 

Mexico 30.0% 

Estonia 21.0% 

Slovakia 19.0% 

Hungary 16.0% 

Czech Republic 15.0%

Average rate 42.5%

At 56.6%, Sweden has the second highest top tax rate in the world. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

European People's Party via Creative Commons
Show Hide image

Ansbach puts Europe's bravest politician under pressure

Angela Merkel must respond to a series of tragedies and criticisms of her refugee policy. 

Angela Merkel, the Chancellor of Germany, is supposed to be on holiday. Two separate attacks have put an end to that. The first, a mass shooting in Munich, was at first widely believed to be a terrorist attack, but later turned out to be the actions of a loner obsessed with US high school shootings. The second, where a man blew himself up in the town of Ansbach, caused less physical damage - three were seriously injured, but none killed. Nevertheless, this event may prove to affect even more people's lives. Because that man had come to Germany claiming to be a Syrian refugee. 

The attack came hours after a Syrian refugee murdered a pregnant Polish woman, a co-woker in a snack bar, in Reutlingen. All eyes will now be on Merkel who, more than any other European politician, is held responsible for Syrian refugees in Europe.

In 2015, when other European states were erecting barriers to keep out the million migrants and refugees marching north, Merkel kept Germany's borders open. The country has resettled 41,899 Syrians since 2013, according to the UNHCR, of which 20,067 came on humanitarian grounds and 21,832 through private sponsorship. That is twice as much as the UK has pledged to resettle by 2020. The actual number of Syrians in Germany is far higher - 90 per cent of the 102,400 Syrians applying for EU asylum in the first quarter of 2016 were registered there. 

Merkel is the bravest of Europe's politicians. Contrary to some assertions on the right, she did not invent the refugee crisis. Five years of brutal war in Syria did that. Merkel was simply the first of the continent's most prominent leaders to stop ignoring it. If Germany had not absorbed so many refugees, they would still be in central Europe and the Balkans, and we would be seeing even more pictures of starved children in informal camps than we do today. 

Equally, the problems facing Merkel now are not hers alone. These are the problems facing all of Europe's major states, whether or not they recognise them. 

Take the failed Syrian asylum seeker of Ansbach (his application was rejected but he could not be deported back to a warzone). In Germany, his application could at least be considered, and rejected. Europe as a whole has not invested in the processing centres required to determine who is a Syrian civilian, who might be a Syrian combatant and who is simply taking advantage of the black market in Syrian passports to masquerade as a refugee. 

Secondly, there is the subject of trauma. The Munich shooter appears to have had no links to Islamic State or Syria, but his act underlines the fact you do not need a grand political narrative to inflict hurt on others. Syrians who have experienced unspeakable violence either in their homeland or en route to Europe are left psychologically damaged. That is not to suggest they will turn to violence. But it is still safer to offer such people therapy than leave them to drift around Europe, unmonitored and unsupported, as other countries seem willing to do. 

Third, there is the question of lawlessness. Syrians have been blamed for everything from the Cologne attacks in January to creeping Islamist radicalisation. But apart from the fact that these reports can turn out to be overblown (two of the 58 men arrested over Cologne were Syrians), it is unclear what the alternative would be. Policies that force Syrians underground have already greatly empowered Europe's network of human traffickers and thugs.

So far, Merkel seems to be standing her ground. Her home affairs spokesman, Stephan Mayer, told the BBC that Germany had room to improve on its asylum policy, but stressed each attack was different. 

He said: "Horrible things take place in Syria. And it is the biggest humanitarian catastrophe, so it is completely wrong to blame Angela Merkel, or her refugee policies, for these incidents." Many will do, all the same.