Key findings
- The OECD average tax wedge rose to 35.1% (from 34.9%). According to the OECD, it rose in 24 countries, fell in 11 and was unchanged in 3; that count uses unrounded figures, so a few changes shown as 0.0 in the table are small rises or falls.
- Belgium (52.5%) is highest and Colombia (0.0%) lowest; 22 of 38 countries are above the OECD average.
- The biggest rise was the United Kingdom, +2.4 points, after employer National Insurance went from 13.8% to 15% and its threshold was lowered in April 2025. Next were Estonia (+1.9) and Germany (+1.3).
- The biggest fall was Australia, −1.7 points, followed by Latvia (−1.4) and Italy (−1.2).
- Employer social security is highest in France (36.3% of gross wage), then Estonia (33.8%) and Czechia (33.8%).
Tax wedge by country, 2025
Select a column heading to sort. Country names link to our employer cost page for that country. Figures are for a single worker with no children earning 100% of the national average wage.
| 1 | Belgium | 52.5 | 27.2 | 52.4 | +0.1 |
|---|---|---|---|---|---|
| 2 | Germany | 49.3 | 20.9 | 47.9 | +1.3 |
| 3 | France | 47.2 | 36.3 | 47.1 | +0.1 |
| 4 | Austria | 47.1 | 27.6 | 46.8 | +0.3 |
| 5 | Italy | 45.8 | 31.6 | 47.0 | −1.2 |
| 6 | Slovenia | 45.3 | 16.6 | 44.7 | +0.6 |
| 7 | Slovak Republic | 42.7 | 32.2 | 42.5 | +0.2 |
| 8 | Estonia | 42.6 | 33.8 | 40.7 | +1.9 |
| 9 | Finland | 42.5 | 20.5 | 42.1 | +0.3 |
| 10 | Spain | 41.4 | 30.6 | 41.1 | +0.3 |
| 11 | Czechia | 41.2 | 33.8 | 41.0 | +0.2 |
| 12 | Hungary | 41.2 | 13.0 | 41.2 | 0.0 |
| 13 | Sweden | 41.1 | 31.4 | 41.5 | −0.4 |
| 14 | Türkiye | 40.3 | 18.5 | 39.6 | +0.8 |
| 15 | Luxembourg | 40.2 | 13.7 | 39.9 | +0.2 |
| 16 | Latvia | 40.1 | 23.6 | 41.6 | −1.4 |
| 17 | Lithuania | 39.8 | 1.8 | 39.4 | +0.4 |
| 18 | Portugal | 39.3 | 23.8 | 39.6 | −0.2 |
| 19 | Greece | 39.3 | 21.8 | 39.5 | −0.2 |
| 20 | Norway | 36.4 | 13.0 | 36.5 | −0.1 |
| 21 | Netherlands | 35.9 | 12.6 | 35.9 | 0.0 |
| 22 | Denmark | 35.8 | 0.7 | 36.2 | −0.4 |
| 23 | Poland | 35.0 | 16.3 | 34.7 | +0.3 |
| 24 | Japan | 33.1 | 15.7 | 32.7 | +0.4 |
| 25 | Ireland | 32.6 | 11.2 | 33.3 | −0.6 |
| 26 | United Kingdom | 32.4 | 13.7 | 29.9 | +2.4 |
| 27 | Canada | 32.1 | 9.6 | 32.0 | +0.1 |
| 28 | Iceland | 31.5 | 6.3 | 31.6 | 0.0 |
| 29 | United States | 30.0 | 8.1 | 30.1 | −0.1 |
| 30 | Australia | 27.9 | 6.1 | 29.6 | −1.7 |
| 31 | Costa Rica | 27.7 | 24.6 | 27.7 | 0.0 |
| 32 | Israel | 26.1 | 6.3 | 25.0 | +1.1 |
| 33 | Korea | 24.8 | 11.1 | 24.7 | +0.1 |
| 34 | Switzerland | 23.0 | 6.4 | 23.0 | 0.0 |
| 35 | Mexico | 21.7 | 10.8 | 21.3 | +0.4 |
| 36 | New Zealand | 20.8 | 0.0 | 20.8 | 0.0 |
| 37 | Chile | 7.5 | 0.4 | 7.0 | +0.5 |
| 38 | Colombia | 0.0 | 0.0 | 0.0 | 0.0 |
| OECD average | 35.1 | 16.6 | 34.9 | +0.2 |
What the numbers mean
The tax wedge is the gap between what an employer pays for a worker and what the worker takes home, expressed as a share of the employer’s total labour cost. It adds personal income tax, employee social security contributions and employer social security contributions, then subtracts any universal cash benefits. A wedge of 35.1% means that, on average, about a third of the cost of employing someone goes to tax and social contributions.
Most of the 2025 movement came from rates and thresholds rather than wages. The United Kingdom’s rise is the clearest policy effect: the OECD attributes it to the higher employer National Insurance rate and the lower threshold at which it starts. In countries where income tax brackets are not fully indexed, wage growth also pushes the wedge up by moving more income into higher brackets.
The wedge is not the same as what a hire costs. Employer social security is shown separately in the table as a share of gross wage, which is the number an employer adds on top of salary; France (36.3%) and Estonia (33.8%) have high employer rates, while Denmark (0.7%) funds its welfare state mostly through income tax. Low wedges in Colombia, Chile and Mexico partly reflect mandatory payments to private pension and health funds, which the OECD treats as non-tax payments outside the wedge. For a full cost estimate including these, use the employer cost calculator.
Source and method
All values come from the OECD’s Taxing Wages 2026 report (comparative tables, OECD Data Explorer), published April 22, 2026, which covers the 2025 tax year; see also the OECD press release. We rank countries by the 2025 wedge and compute the change from the OECD’s unrounded 2024 and 2025 figures, so a change can differ by 0.1 point from the difference of the rounded numbers shown. We have not adjusted or estimated any value.
Frequently asked questions
What is the tax wedge?
The tax wedge is income tax plus employee and employer social security contributions, minus any cash benefits, as a share of the employer's total labour cost. It measures how much of what an employer spends on a worker goes to the government rather than to the worker's take-home pay.
Which OECD country has the highest tax wedge in 2025?
Belgium, at 52.5% for a single worker on the average wage, followed by Germany (49.3%), France (47.2%). The OECD average was 35.1%.
What is the tax wedge in the United States?
30.0% in 2025 for a single worker on the average wage, ranking 29th of 38 OECD countries and below the OECD average of 35.1%.
Why is Colombia's tax wedge 0%?
At the average wage, a single worker in Colombia pays no personal income tax, and the mandatory pension and health payments are classed by the OECD as non-tax compulsory payments rather than social security contributions, so they fall outside the tax wedge. Chile and Mexico have low wedges for similar reasons.
Can I reuse this data?
Yes. Download the CSV, and please credit the OECD as the source (OECD, Taxing Wages 2026) and link to this page. The values are the OECD's published comparative figures; we only compiled and ranked them.