These Are the Best and Worst Countries for Taxes, Study Shows

Where does the U.S. rank when it comes to tax-friendliness?

Almost no one likes paying taxes, and it can only get worse when you’re a top earner: The top incomes in the U.S. will pay 37 percent of their income to the federal government just for income taxes.

But if you think you’re paying way too much in taxes, it’s worth noting that the United States is among neither the 20 most tax-friendly nor the 20 least tax-friendly countries in the world, according to a new study from GOBankingRates.

Keep reading to find out which countries pay more in taxes than Americans.

The study looks at the top rates for income taxes, social insurance employee taxes (payroll taxes), and indirect taxes like a sales tax or value-added tax (VAT). The results show that there can be a considerable difference from country to country when it comes to taxes, with some countries asking much more of their richest citizens.

Here are the 20 most tax-friendly countries in the world:

1. Qatar
2. United Arab Emirates
3. Bahamas
4. Kuwait
5. Kazakhstan
6. Iraq
7. Guatemala
8. Yemen
9. Russia
10. Lebanon
11. Syria
12. Belarus
13. Mauritius
14. Botswana
15. Ukraine
16. Sri Lanka
17. Indonesia
18. Estonia
19. Fiji
20. Trinidad and Tobago

The study reveals some interesting geographical and regional trends surrounding tax rates. The most tax-friendly countries, in particular, tend to have a lot in common. There are seven countries from the Middle East in the 20 most tax-friendly group, including six of the top 10. And, there are six different island nations among the 20 most tax-friendly, including at least one nation in each of the world’s three largest oceans.

Here are the 20 least tax-friendly countries:

1. Netherlands
2. Slovenia
3. Austria
4. Germany
5. Uruguay
6. Croatia
7. Sweden
8. Greece
9. Belgium
10. Finland
11. Portugal
12. Japan
13. Chile
14. Israel
15. Luxembourg
16. Argentina
17. Bosnia and Herzegovina
18. Norway
19. Italy
20. Turkey

The 20 least tax-friendly countries are predominantly European, with 15 of the 20 being a part of the European continent. However, those are clearly concentrated in Northern and Western Europe, for the most part, as Eastern Europe featured four countries among the most tax-friendly.

The only two Asian countries on the list, Japan and Israel, are over 5,000 miles apart. And the only other continent with any countries in the top 20 for having high taxes is South America with three — Uruguay, Argentina and Chile.

Neither North America nor Africa has countries featured among the 20 least tax-friendly to their wealthiest residents.

Keep reading to see the 50 cheapest countries to live in.

Methodology: GOBankingRates compared the tax policies of every country in the world as provided by prominent auditing firm KPMG to determine the best and worst places to live if you’re looking to avoid paying taxes. The study focused on the top individual income tax bracket as well as the rates for social insurance employee taxes, i.e. payroll taxes, and any indirect taxes like a sales taxes or a value-added tax (VAT). Each factor was scored and then weighted to determine which nation’s overall approach is hitting its wealthiest residents the hardest and the lightest.