Nowhere on the Continent are people taxed more than in Denmark. Factoring in the top marginal rate applied to all annual earnings above £66,500 alongside local and other rates sees the wealthiest Danes subjected to 55.9 percent tax.
On a salary of £35,000 a year, a worker in Copenhagen would see 32.6 percent of their income go towards tax (£11,431). The equivalent for a Londoner would be just 20.5 percent (£7,178).
Denmark was followed by France (55.4 percent), Austria (55 percent), and Spain (54 percent). Of the top ten countries with the highest top-income tax rates, nine were in Western Europe or Scandinavia.
In contrast, all ten of the lowest were in the Balkans or Eastern Europe. The highest earners in Montenegro are taxed less than anywhere else, at just nine percent. Someone in the capital of Podgorica on a £35,000 wage would pay 24.33 percent (£8,506).
On the lower end of the scale, the Adriatic coastal state was followed by Bulgaria, Romania, Bosnia and Herzegovina, Moldova, and Kosovo all on ten percent.
This analysis is excluding the handful of European microstates with longstanding reputations as tax havens.
Andorra – nestled between France and Spain midway along the Pyrenees – only established a personal income tax in 2014 as a result of pressure from the EU. Even now, the first €24,000 (£20,900) is exempt and the rest is taxed at just 10 percent.
Monaco persists in levying no income tax on its citizens at all. Corporations that make 75 percent or more of their income within the 0.78-square-mile country’s borders are also tax-exempt. The main rate in the UK has just been upped to 25 percent.
Most countries in the world have a progressive tax system in place, where people are charged a higher proportion of their income the more they earn. This is the case in the UK: the first £12,570 is tax-free, earnings between £12,571 to £50,270 are taxed at 20 percent, earnings between £50,271 and £125,140 at 40 percent and anything beyond at 45 percent.
Some 20 countries, meanwhile, apply a flat rate to all, regardless of salary. This is the case in many of the low-tax former communist states such as Bulgaria, Romania, and Moldova.
