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.

Photo: Getty Images
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The Fire Brigades Union reaffiliates to Labour - what does it mean?

Any union rejoining Labour will be welcomed by most in the party - but the impact on the party's internal politics will be smaller than you think.

The Fire Brigades Union (FBU) has voted to reaffiliate to the Labour party, in what is seen as a boost to Jeremy Corbyn. What does it mean for Labour’s internal politics?

Firstly, technically, the FBU has never affliated before as they are notionally part of the civil service - however, following the firefighters' strike in 2004, they decisively broke with Labour.

The main impact will be felt on the floor of Labour party conference. Although the FBU’s membership – at around 38,000 – is too small to have a material effect on the outcome of votes themselves, it will change the tenor of the motions put before party conference.

The FBU’s leadership is not only to the left of most unions in the Trades Union Congress (TUC), it is more inclined to bring motions relating to foreign affairs than other unions with similar politics (it is more internationalist in focus than, say, the PCS, another union that may affiliate due to Corbyn’s leadership). Motions on Israel/Palestine, the nuclear deterrent, and other issues, will find more support from FBU delegates than it has from other affiliated trade unions.

In terms of the balance of power between the affiliated unions themselves, the FBU’s re-entry into Labour politics is unlikely to be much of a gamechanger. Trade union positions, elected by trade union delegates at conference, are unlikely to be moved leftwards by the reaffiliation of the FBU. Unite, the GMB, Unison and Usdaw are all large enough to all-but-guarantee themselves a seat around the NEC. Community, a small centrist union, has already lost its place on the NEC in favour of the bakers’ union, which is more aligned to Tom Watson than Jeremy Corbyn.

Matt Wrack, the FBU’s General Secretary, will be a genuine ally to Corbyn and John McDonnell. Len McCluskey and Dave Prentis were both bounced into endorsing Corbyn by their executives and did so less than wholeheartedly. Tim Roache, the newly-elected General Secretary of the GMB, has publicly supported Corbyn but is seen as a more moderate voice at the TUC. Only Dave Ward of the Communication Workers’ Union, who lent staff and resources to both Corbyn’s campaign team and to the parliamentary staff of Corbyn and McDonnell, is truly on side.

The impact of reaffiliation may be felt more keenly in local parties. The FBU’s membership looks small in real terms compared Unite and Unison have memberships of over a million, while the GMB and Usdaw are around the half-a-million mark, but is much more impressive when you consider that there are just 48,000 firefighters in Britain. This may make them more likely to participate in internal elections than other affiliated trade unionists, just 60,000 of whom voted in the Labour leadership election in 2015. However, it is worth noting that it is statistically unlikely most firefighters are Corbynites - those that are will mostly have already joined themselves. The affiliation, while a morale boost for many in the Labour party, is unlikely to prove as significant to the direction of the party as the outcome of Unison’s general secretary election or the struggle for power at the top of Unite in 2018. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.