August 8th is Belgium’s TAX LIBERATION DAY

Starting tomorrow, Belgians keep their earnings

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Brussels, 7 augustus 2013 – On Thursday August 8 2013, Belgium is again the last EU member state to celebrate its Tax Liberation Day. Belgian workers not only remain the highest-taxed in Europe, but their taxes are rising - the typical employee worked 3 days longer than in 2012 to pay the state. For the fourth consecutive year, an EU wide calendar of “Tax Liberation Days” for typical workers in each of the EU member countries has been released by New Direction – Foundation for the European Reform (Brussels) and Institut économique Molinari (IEM, Paris) with data provided by EY.

Using a consistent methodology across all EU countries, the data reflect the tax realities experienced by real, working people. 2013’s Tax Liberation Days are as follows:

Cyprus: March 14 Poland: June 12 Netherlands: June 27
Ireland: April 24 Spain: June 12 Latvia: June 27
Malta: April 29 Estonia: June 14 Romania: July 01
United Kingdom: May 13 Greece: June 17 Italy: July 10
Bulgaria: May 18 Lithuania: June 18 Germany: July 13
Luxembourg: May 25 Finland: June 19 Hungary: July 16
Portugal: June 04 Czech Rep.: June 19 Austria: July 23
Denmark: June 06 Slovakia: June 20 France: July 26
Slovenia: June 07 Sweden: June 22 Belgium: August 08

“Belgian workers – among the world’s most skilled and productive – rank 10th in the EU in net salary, but taxes make them Europe's most expensive to hire,” explained co-author James Rogers of Institut Economique Molinari. “If employers leave Belgium it’s not because the workers are too expensive, but because their taxes and social charges are the highest in Europe.”

“It is as if the government really thought increasing taxes would reduce the deficit. Tax increases depress business, further delaying the prospects of a return to balanced public accounts. The sustainable solution to the current crisis lies in a reducing government expenditures, with an overhaul of public policy, just as it has been done successfully in several other countries,” says Cécile Philippe, director of Institut Economique Molinari.

Key findings - Belgium

  • Belgium retains its ranking as the country that taxes labour at the highest rate in the European Union; an employer in Belgium spends 2.52€ for a typical worker to net 1€ after taxes.
  • A Belgian employee’s “real tax rate” is now 60.25%, compared to an EU average of 45.06%

Key findings - Europe:

  • As a single economic entity, typical workers across the European Union saw their average “real tax rate” rise again this year, from 44.11% in 2011 to 45.06% in 2012. The rise of nearly one full percent since 2010 is largely a consequence of VAT increases in 15 EU member states since 2009.
  • 43.4% of all payroll taxes collected in the EU countries – employer contributions to social security paid on top of gross salaries – are largely invisible to employees.
  • Flat tax policies have offered tax relief to some. Typical workers, however, are taxed at higher rates in "flat tax" countries (46.2%) than in "progressive" systems (44.3%) – a gap that has widened since 2010.
  • More than half (54.5%) of EU citizens are not in the labour force. Working people carry most of the tax burden, which grows heavier as populations grow older.

“Tax Liberation Day” is the calendar day on which a worker theoretically stops working to pay taxes to the state and begins to keep his/her earnings. The data in the calendar reflect the reality experienced by real, working people in the European Union and the true cost of hiring employees in each state.


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The study, written by James Rogers and Cécile Philippe of Institut économique Molinari (Paris), uses OECD salary figures for typical workers as a baseline. Payroll tax calculations are made by EY. The Tax Burden of Typical Workers in the EU 27 is the only EU-wide study using consistent methodology to calculate how long Europeans have to work before they can keep their earnings and stop paying the state.
http://newdirectionfoundation.org/documents/public/attachments/TaxLiberationDays2013.pdf

Note to Editors

Institut économique Molinari (IEM) is an independent, non-profit research and educational organization based in Paris. Its mission is to promote an economic approach to the study of public policy issues by offering innovative solutions that foster prosperity for all.

New Direction - The Foundation for European Reform is a free market think-tank established in Brussels in 2010 to add innovative ideas and encourage reform efforts in Europe. Together with a strong network of partner think tanks around Europe, New Direction produces original and relevant research papers focusing on the most pressing issues in the area of economic growth, competition, financial regulation, energy security, taxation, defence, agricultural policy, bureaucracy and EU institutional affairs.