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The German state has never collected such high tax revenues — measured against economic output — as it does today. According to the study, tax revenues, measured against gross domestic product, stand at 36.7% (an increase of 0.2% compared with the previous year). Only in 1977 and 1978 were tax revenues at a comparable level. This places Germany in the top third of OECD countries, although it is still not considered a high-tax country. The study also notes that wealth and consumption should be taxed instead of income; in Germany, wealth taxes play hardly any role. The study further criticises the fact that reduced VAT rates, for example for hotels, restaurants, theatres and cinemas, primarily benefit high earners. On the OECD press pages, you can find out more about how other European countries performed and about the methodology of the study.
Frequently asked questions
Frequently asked questions
What is Germany's tax-to-GDP ratio according to the OECD study?
Germany's tax revenue amounts to 36.7 % of gross domestic product. This represents an increase of 0.2 percentage points over the previous year and marks a historic high, previously reached only in 1977 and 1978.
Is Germany considered a high-tax country in the OECD comparison?
No. Despite its historically high tax ratio of 36.7%, Germany ranks only in the top third of OECD countries. Other states show significantly higher tax ratios, so Germany is not classified as a high-tax country.
What shift in the tax burden does the OECD recommend?
The OECD recommends reducing the tax burden on income and instead taxing wealth and consumption more heavily. According to the OECD, wealth-related taxes have so far played only a minor role in Germany.
Why does the OECD criticise reduced VAT rates?
According to the OECD, reduced VAT rates—for example for hotels, restaurants, theatres or cinemas—primarily benefit higher earners, who use such services more frequently. From a distributional perspective, the OECD therefore considers these tax breaks problematic.