The states where you pay less taxes - Ranking 2022

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Lluis Enric Mayans

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As you imagine, Italy does not enjoy a good reputation when it comes to taxes, being one of the countries that make more "cash" in the world and in Europe: with over 40% tax burden we are in tenth place in the world rankings. The heaviest taxes essentially concern those on work, since the average cost of labor in Italy is over 46 thousand euros for each individual worker.

There are, however, some countries in the world where taxes are very low, below 10% globally, and this is due to the fact that some types of taxes are also kept at 0%. From the ranking you can see the 15 countries in the world where you pay less taxes and among these several Asian countries stand out; the primacy goes to the United Arab Emirates, which have a tax burden of just over 1%!

How the tax burden is calculated

Their weight, in the ranking you will see, is calculated from the ratio of total tax revenue to the country's GDP. In this way, it is evident how much of the wealth of a people is demanded from the respective state.
Essentially, the value indicates how much the overall taxation affects the income of businesses and workers.

State Continent % tax
Afghanistan Asia 6,4%
Sudan Africa 6,3%
Nigeria Africa 6,1%
Iran Asia 6,1%
Congo Africa 5,9%
Saudi Arabia Asia 5,3%
Burma (Myanmar) Asia 4,9%
Bahraini Asia 4,8%
Chad Africa 4,2%
Libya Africa 2,7%
Qatar Asia 2,2%
Oman Asia 2%
Equatorial Guinea Africa 1,7%
Kuwait Asia 1,5%
United Arab Emirates Asia 1,4%

5 - Qatar, Asia: tax burden at 2,2%

Qatar, in fifth place in the ranking of states where less taxes are paid, has a tax burden of 2,2%.
There are no personal income taxes, but the taxation of income deriving from sole proprietorships is envisaged and the corporate income tax rate is 10%. The Qatari tax system does not include VAT and the general sales tax.

The main economic resource on which Qatar's wealth is based is represented by oil, and also by natural gas fields. In fact, theexport of oil and gas is the primary source of state revenue, and through its management numerous projects are financed.
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  • VAT: there is no value added tax (0%)
  • Income tax: 0%
  • Corporate taxes: 10%

4 - Oman, Asia: tax burden at 2%

There is not much difference in the various countries of the Middle East, and also in Oman the Qatari fiscal logic is roughly in force: no personal income tax, 15% corporate tax and ... yes, there is a tax equivalent to VAT here. Just think, it's 5% ...
The fact that there is no personal income tax also means that corporate dividends are not subject to tax ... not bad, huh?
If you're wondering how that's possible ... well. it is easy to say: Oman's economy is almost entirely based on oil production, that yes, it is taxed, with rates up to 55%.
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  • VAT: single rate of 5%
  • Income tax: 0%
  • Corporate taxes: 15% (55% on oil companies)

3 - Equatorial Guinea, Africa: tax burden of 1,7%

The tax system of Equatorial Guinea is actually not that close to that of the states that flank it in the rankings. Individual income tax rates range from 0 to 35%, while corporate (corporate) taxes have a single rate of 35%. The VAT rates are 0% and 15%.
So why does the tax burden affect GDP so little? Someone finds an answer in the shadow economy and above all in the fact that still 50% of the work is employed in agriculture and pastoralism, with a subsistence economy still widespread in most of the population.
However, Since oil fields and diamond mines have been discovered, the country's GDP has a growth rate unmatched in the world: + 17%, but with a wealth still very poorly distributed.

  • VAT: rates of 0% and 15%
  • Income tax: 0 to 35%
  • Corporate taxes: 35%

2 - Kuwait, Asia: tax burden of 1,5%

In Kuwait, global taxation is 1,5: there are no tax systems on personal income, nor on workers' wages. There are no business income taxes, no sales, property and value added taxes.
Some of the taxes to be paid concern workers and employers, who are obliged to pay social security contributions every month.

Kuwait's economy is based on the oil industry, as it owns 10% of the world's oil reserves.
Therefore, oil is the main resource and contributes 50% of GDP as well as 90% of exports. Also from the oil industry comes 80% of public revenue.

  • VAT: there is no value added tax (0%)
  • Income tax: 0%
  • Corporate taxes: 0%

1 - United Arab Emirates, Asia: tax burden at 1,4%

Let's go back to the Middle East, to the United Arab Emirates: once again, we find the almost total absence of taxation for both natural and legal person income. The equivalent of VAT does not exist (we are considering introducing one at 3%, just think ...), and the only sectors subject to taxation are Oil & Gas (up to 55%), bank / finance (up to 20%) and hotels (up to 15%).
As regards the cost of labor, companies are only required to pay portions of pension funds for each worker.

  • VAT: there is no value added tax (0%)
  • Income tax: 0%
  • Corporate taxes: 0% (55% on oil companies, 20% banking / finance sector, 15% hotel sector)

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