Developing countries lead the way in tax revenue rises

The OECD has higher tax revenues than more developing regions due to the fact that wealthier nations tend to take more tax from a richer base of high earners.

Across the 80 countries in the database, the latest tax-to-gdp ratios available range from 10.8pc to 45.9pc, with the median ratio standing at 26.2pc.

This is far higher for wealthier regions, with the average for European countries being 36.9pc.

These countries tend to have a higher share of personal income tax and social security contributions making up their tax revenue.

The average stood at 30.1pc for Oceania countries and 23.6pc in North America. Africa had the lowest average tax revenues, at an average 19.1pc of GDP.

The Democratic Republic of the Congo, Indonesia, Guatemala, Uganda and the Dominican Republic had the lowest tax revenue takes, all below

14pc of GDP. But the gap is closing. Since 2000, three quarters of the countries in the database have increased their tax-to-gdp ratios, with a quarter making increases of more than 25pc.

Most of these countries are from Africa, and the Latin America and Caribbean regions.

While the average European country’s tax revenues have only increased by 0.8pc since 2000, Africa’s have climbed by 34.6pc.

Similarly, South America’s average tax revenue has increased 32pc and the average North American country – which includes many poorer Caribbean nations – has grown by 23.4pc.

Since 2000, Ireland has seen tax revenues fall 25.1pc, the biggest drop in the OECD listings. Kazakhstan and Singapore also saw taxes fall by 21.5pc and 12.1pc respectively.

This contrasts with states such as Ecuador, Togo and Niger, which have seen their tax-to-gdp ratios increase by 99pc, 96pc and 75.5pc respectively – albeit from very low bases.