The Basque tax burden, below the averages for Spain and the EU

Euskaraz irakurri: Euskal precio fiskala, Espainiako eta EBko batez bestekoen azpitik

When we talk about taxes, we are interested in the comparison between different tax systems. The fiscal pressure, which we can measure by relating the amount of taxes and contributions to the gross domestic product (GDP) of a country, depends on the socio-economic development of each society, but also on its ideology. Both elements play a fundamental role when deciding how much to tax.

According to the 2021 data collected by EITB DATA, the greatest tax pressure is in Denmark: taxes are the 46.9% of its GDP. Close are France (45.1%), Italy (43.3%) and Sweden (42.6%).

All those states are above the European Union averagethat is of 41%. The Spanish state, however, is below this average. The tax burden in Spain is 38.4%. The cases of Australia (28.5%) and the United States (26.6%) stand out for their low tax burden.

If we look at 2020, we can compare the data between autonomous communities. Both the Basque Autonomous Community (36.4%) as the Foral Community of Navarre (36.2%) They are somewhat below the Spanish average (36.8% in 2020).

There are no major differences between autonomous communities, and these respond to the differences between income, unemployment rates and inequality within each territory.

For example, Catalonia (38.8%) and Madrid (38.5%) have a higher tax burden: there are higher incomes than in Hego Euskal Herria, but also a higher unemployment rate and more inequality. In Galicia (34.9%) and La Rioja (34.2%), however, the tax burden is lower, since there is more inequality, despite a relatively good result in unemployment.

As reflected by EITB DATA, balanced economic development results in higher incomes and less social inequality, which is why the collection objective is distributed among more people and thus reduces its impact on GDP.