Folks on the left think it is terrible for nations to be “tax havens.”
Since I’ve written many columns defending low-tax jurisdictions (including the moral argument), let’s flip the script today and instead look at “tax hells.”
The 1841 Foundation has just released the 2023 version of its Tax Hell Index, which reviews nations (mostly in Europe and the Americas) and ranks them based on fiscal pressure and quality of governance.
Here are the unfortunate countries that are tax hells – or are at risk of crossing the threshold and becoming tax hells.
The world’s three worst tax hells are Belarus, Venezuela, and Argentina (they also held the top three spots in last years Index).
It’s hardly a surprise to see those nations on the list, or to see countries like Brazil and Russia as well.
The 1841 Foundation explains what makes a nation eligible to be a tax hell.
Although the fiscal pressure is an important factor, we believe that a ‘tax hell’ is not only a country with high taxes, but rather one with a weak rule of law and where the rights to privacy and property are not enforced or protected as required. …Therefore, when considering the results, countries with high government quality and economic and legal stability may have high taxes (i.e., Denmark), but are very far from being considered tax hells. …In fact, there are countries with both low and high taxes in the top-13 tax hells; all of them, however, have low quality of government, high levels of corruption and use of discretionary power, poor economic management, weak institutions, and low or complete lack of legal certainty.
Even though the Index is not based solely on tax, the three best nations (i.e., with the lowest scores) are Ireland, Switzerland, and Luxembourg, all of which have been labelled as tax havens.
Which reaffirms a point I have made about so-called tax havens having higher-quality governance that high-tax nations.
[…] A responsible spending policy could enable better tax policy. With any luck, Argentina might even lose its status as a “tax hell.” […]
Dan, you gotta see this article: “Portugal’s tech boom challenged by tax change” on BBC. Hope you can tear into that one. Portual is getting rid of the tax break for entrepreneurs and surprise surprise. Yet some “economists” try to defend it on the grounds of “fairness”
Мое имя Вася Иванов. И я есть В фейсбуке в Латвии. Это я написал вам по-русски. Это не меняет сути, ваше исследование -всего лишь оправдание растраченных средств гранта .Я готов вступить в спор. Меня можно найти в фейсбуке. Выберите поле для дискуссий, чтобы всем было удобно наблюдать. Я не афиширую себя в соц.сетях, но меня вполне можно найти. Я не фейк, и хочу доказать, что вы безграмотный, от слова совсем. Как только вам присвоили такую степень грамотности? Над этим тоже стоит задуматься. Может в дискуссии с вами я докажу вашу некомпетентность, но более чем уверен, что мои доводы и аналитика будут столь весомы, что получиться степень магистра -аналитика экономки ваших университетов будет всего лишь формальность. Я не имею к вашим исследованиям ни капли веры, но к вам, как к “заблудшей овце”, которая провела столько исследований испытываю уважение.
День добрый. У меня ощущения, что он либо совсем не знаком с реальным видением существующего, либо полный дебил, либо это заказное исследование с с заранее запрограммированными результатами. В любом случае, априори, это исследование есть фикция чистой воды, а в переводе на нормальный язык, просто блеф, Уважаемый “учёный” я готов вступить с вами а дискуссию на страницах этой газеты и доказать, что вы малограмотный идиот.
Maybe if we goes to Poland, I will earn with my small business 4000$, but I don’t know language, and there are expensive medicine.
In Belarus we have many friends who is doctors. Yes in Belarus medicine will cost money, but we can choose best medic in our country for small pay of 20$ for one visit, not 50euro for low level doctor.
In Belarus we have only one problem, can’t travel normally, airplane Belavia is too expensive
I live in Belarus, and I have small business. Belarus raised taxes for everyone for last 8 years. My income for that years is the same, but I start to working more efficiently, my job is connected with IT. Working people start to live that country for the last 3 years, and that dynamic raise. Government don’t know what to, they just raise taxes for others that don’t live. But with that taxes, we can live normaly for income of 2000$ in months, but our sister live on Poland and for family 2000$ in Poland is nothing… they have better taxes, but can’t live normaly with that income.
[…] входить до четвірки податкового антирейтингу – дослідження The 1841 […]
In Belarus, the income tax for entrepreneurs is 20% and they are still going to increase it in 2024. At the same time, taxes on real estate, transport and land are also increased. The government has no money due to incompetent management, and they are going to close the hole in the budget by raising taxes on everything.
“Our Tax Hell Index was created to evaluate countries that combine high taxes with poor government management. “We believe that ‘tax hell’ is not only a country with high taxes, but also a country in which there is no rule of law, in which privacy and property rights are not adequately protected,” the study description says.
[…] « The 2023 Tax Hell Index […]
I’d be interested to know how those figures were arrived at. With a Corp tax rate of 18% and an income tax rate of 13-17%, Belarus isn’t a tax haven, but to call it a “tax hell”?
I’d like to see the calculations.
Hi Dan,
I am surprised South Africa (or any other African countries) were not in the Tax Hell list or even the Risky, but perhaps it wasnât measured?
Thanks for the daily insights,
Together in Freedom,
Love your columns, but I don’t know how Ireland got on the list. The corporate rate is low, but income taxes on individuals are high and rapidly rise to 50%. My family and many colleagues live there. Also there is nothing resembling the mortgage deduction we have in the USA.
Tax hell’s need demon enforcers. All makes good sense.