Tax-on-GDP
The
diagram below shows taxes as a fraction of gross domestic product (GDP) for Norway, Sweden,
Denmark, the EU, the USA and
the OECD-average in the period 1978-2004.
Figure 1 Total tax revenue in per cent of GDP for Norway, Denmark, Sweden,
the European Union, the United States and the OECD average. The Tax-on-GDP
ratio for Norway
is based on accrued values. The petroleum adjusted tax-on-GDP ratio for Norway
is based on total accrued revenue and GDP less estimated revenue and GDP from
the resource rent in the petroleum sector. All other ratios are based on cash
revenue.
Source: OECD and Ministry of Finance,
Norway.
The total
tax-on-GDP ratio in 2003 (43.4 pct.) for Norway
is slightly higher than the weighted EU average (40.5), and far higher than the
OECD average and the US
(36.3 pct. and 25.6 respectively). On the other hand, Denmark and Sweden
have a higher tax-on-GDP ratio than Norway (48.3 pct. and 50.6 pct.
respectively). When the ratio is adjusted for resource rent income from the
petroleum sector, the 2003 tax-ratio for Norway increases to 42.0 per cent.
Differences
in social security systems can to some extent explain why the tax-on-GDP ratio
differs between countries. The Nordic pension systems have high gross pension
benefits. On the other hand, most pension benefits are taxable. The tax-on-GDP
ratio will be higher in countries where pension benefits are taxable compared
to countries where these benefits are given on a net basis, even when the net
benefits do not differ to any great extent.
