Countries With the Highest Taxes: Income, Property, and Sales Tax Rates

For most people, taxes are an unavoidable cost of living in a country. For globally mobile high-net-worth individuals, they are a variable that can be planned and optimized. Taxes such as income, property, and sales taxes vary significantly across countries, allowing these individuals to structure where they live, work, and hold property to align with the tax rules that suit them best.

While this might suggest moving to a tax haven, the other end of the spectrum offers some of the most developed and livable countries in the world. So, in this article, we’ll explore the countries with the highest taxes. You’ll learn: 

• Which countries have the highest income taxes
• Which countries have the highest property taxes
• Which countries have the highest sales tax or VAT
• How to reduce tax exposure when moving abroad

Countries With the Highest Income Tax Rates

When considering countries with the highest income tax rates, it’s important to distinguish between the marginal and effective tax rates. 

The marginal rate is what applies to the portion of income above a certain threshold. In a country with a 50% top rate on income above USD 1 million, for example, only the portion of the income above the threshold would be taxed at that rate. Income below the threshold would be taxed at a different, typically lower rate. 

The effective tax rate is the actual portion of income paid in taxes after all brackets are taken into account. Usually, the effective tax rate is lower than the marginal tax rate. 

However, because effective tax rates vary from case to case, marginal rates provide a more reliable basis for comparison. The countries with the highest top marginal rates on income in the world are: 

1. Denmark
2. Japan
3. Austria
4. Finland
5. Sweden
6. Aruba
7. Belgium
8. Israel
9. Slovenia
10. Netherlands

Bonus read: Find out more about the countries with the lowest tax rates in Europe.

Denmark

Denmark has a complex personal income tax system that recognizes three different types of income: 

1. Personal income, which covers salary and similar types of income
2. Capital income, which covers interest income and expenses
3. Share income, which covers dividends and capital gains on shares

Personal and capital income are jointly taxed, at rates ranging from 12.5% for the bottom bracket to 5% for the additional top bracket. 

Taxpayers are also liable for a municipal tax on their taxable income, which ranges from 23.39% to 26.30%. In total, the maximum marginal tax rate on personal income for the municipal tax and the first two brackets of the national tax is capped at 44.57%, while the maximum marginal tax rate on capital income is capped at 42%.

Taxpayers are liable for an additional 8% labor market contribution tax on their personal income, which isn’t included in the maximum tax rate cap. When the labor market contribution and the two top brackets are layered on the capped rate, the maximum tax on income in Denmark increases to roughly 60.5%.

Share income is taxed at two rates: 

1. 27% on income below the DKK 79,400 (USD 12,124) limit
2. 42% on income above the DKK 79,400 (USD 12,124) limit

It’s important to note that Denmark applies a number of allowances and deductions to personal income taxes, which can significantly lower the effective tax rate relative to the marginal tax rate.

Individuals with limited tax liability in Denmark (non-tax residents) are subject to taxation only on income derived in the country. 

Japan

Japan recognizes three types of taxpayers for determining the source of taxable income: 

1. Permanent resident taxpayers, who are liable for taxes on their worldwide income
2. Non-resident taxpayers, who are liable only on the Japan-sourced income
3. Non-permanent-resident taxpayers, who are liable on Japan-sourced income and foreign income that’s remitted to Japan

The country employs a progressive national income tax rate, which starts at 5% and has a top marginal rate of 45% on income over JPY 40 million (USD 246,000). 

Japan levies two other taxes on personal income: 

Type of Tax	Rate
Surtax	2.1% of the national income tax
Local inhabitants tax	10% of the prior year’s income

For high-net-worth individuals, Japan has a system that requires them to pay a certain minimum in taxes. 

In 2025 and 2026, earners with income over JPY 330 million (USD 2.03 million) apply a 22.5% tax on earnings above the threshold. If the amount exceeds what they would typically pay, it is added as an additional tax on top of the regular income tax. 

From 2027, the threshold will be lowered to JPY 165 million (USD 1.02 million), and the minimum tax rate will be increased to 30%. 

Non-resident taxpayers are subject to a flat 20.42% national income tax and surtax on their Japan-derived income. They might also be subject to the local inhabitants’ tax if they are registered as residents of a municipality in Japan.

Austria

Austria has a straightforward progressive system that levies taxes on most forms of personal income, including: 

• Income from trade or business
• Income from profession or employment
• Income from investments and property

The tax rates range from 0% on income under EUR 13,539 (USD 15,470) to 55% on income over EUR 1 million (USD 1.14 million). 

Austrian residents are liable for personal income tax on their worldwide income. Non-residents are liable only for their Austrian-source income. They use the same rates as the residents. 

Finland

Finland has a complex tax structure, with taxes levied at the national and municipal levels, as well as special taxes to support public broadcasting and religious institutions. Overall, the top marginal income tax rate is around 52%, with the following specific rates:

Type of Income Tax	Rate Range
National income tax	0%–37.5%
Municipal income tax	4.7%–10.9%
Church income tax	1%–2.25%
Public broadcasting income tax	2.5%, capped at EUR 160 (USD 182) annually
Capital income tax	30%–34%

The top national income tax rate applies to income above the EUR 52,100 (USD 59,500) threshold. 

Finland also has two special regimes for the taxation of foreigners who derive their income in the country: 

1. Foreign expert tax regime: Applies a flat 25% tax rate to Finland-sourced income from foreigners with specialized knowledge and a minimum monthly salary of EUR 5,800 (USD 6,620)
2. Personal income tax for non-residents: Applies a 35% tax on employment income and a 30% tax on income from dividends, interest, and royalties, to individuals who are not residents of Finland

Sweden 

Sweden charges local and national tax on income derived from employment. The local tax authorities determine the local tax rates, which tend to range from 29% to 35%, with 32% as the average. 

The average municipal income tax rate, excluding church tax, is 32.38%, though it varies by municipality. In Stockholm, the municipal income tax rate is 30.60%.

The national income tax is levied only on income over SEK 643,000 (USD 66,500), at a rate of 20%. 

The country also imposes significant social security contributions. Employers pay social security contributions of 31.42% on salaries, while self-employed individuals pay 28.97% of their net business income.

Sweden also charges taxes on other types of personal income: 

Type of Tax	Rate
Capital gains tax	30%
Property sale gains tax	22%

Non-residents who derive their income in Sweden are liable for a 22.5% tax. Starting in 2027, the tax rate for non-residents will be reduced to 20%.

Aruba

Aruba has a progressive personal income tax system with rates ranging from 0% to 52%. The top marginal rate applies to income over AWG 135,527 (USD 75,300). 

The Aruban tax code also provides a special 25% tax rate on income from the following sources:

• Severance and similar payments
• Capital gains 
• Dividends

Non-residents of Aruba become liable for personal income tax as soon as they start deriving income in the country, or work there for at least one day. The sources of income a non-resident can be liable for include: 

• Employment income
• Income from Aruban real estate
• Income as a director or manager in an Aruban company
• Income from owning at least 25% of an Aruban company for at least five years (substantial interest)

Belgium

Belgium charges both residents and non-residents a progressive tax rate between 25% and 50%, with the top rate applying to income over EUR 49,840 (USD 56,800). Residents are liable for taxes on their worldwide income, while non-residents are liable only for their Belgium-source income. 

Income from investments is taxed at 30%, except interest on an ordinary savings account, which is taxed at 15%. 

Taxpayers might also be liable to a local tax surcharge, which ranges from 0% to 9% of the national income tax for residents and is 7% for non-residents. 

Israel 

Israel maintains a progressive personal income tax system, with rates ranging from 0% to 47%. However, for income above the ILS 721,560 (USD 239,700) threshold, the country also applies a 3% surcharge, bringing the total top marginal tax rate to 50%.

Israel levies separate taxes for income from sources other than employment, such as: 

Type of Income	Tax Rate
Capital gains	25% (30% for major shareholders)
Dividends and interest	25% (30% for major shareholders)
Rental income	10% with no deductions, or the marginal rate with deductions

Individuals whose capital income surpasses the top marginal tax threshold of ILS 721,560 (USD 239,700) are liable for an additional 2% surcharge on the portion above it.

It’s important to note that leaving Israel’s tax residency triggers a deemed sale of capital assets, also known as an exit tax.

Israel offers a 10-year tax holiday under which foreign-source income is exempt from tax, making it a particularly powerful special tax regime for tax planning purposes.

Slovenia

Slovenia’s residents are liable for personal income tax on their worldwide income at progressive rates ranging from 0% to 50%. The highest marginal rate applies to income above EUR 82,346 (USD 93,800). 

Non-residents are taxed at the same rate, but only on income derived from Slovenia. 

Slovenia also maintains a separate 25% tax rate for income derived from the following sources: 

• Capital gains
• Interest and dividends
• Real estate rentals

The tax rate for capital gains decreases with the length of the holding period: 

Length of Holding	Tax Rate
Up to five years	25%
5–10 years	20%
10–15 years	15%
Over 15 years	0%

Bonus read: Find out which other countries don’t charge a capital gains tax.

Netherlands

The Netherlands’ tax system divides income into three boxes based on its source: 

• Box One: Employment income, deemed income from home ownership of a principal residence, period payments, benefits relating to income provisions
• Box Two: Income from a substantial interest
• Box Three: Income from savings and investment 

Each type of income has its own tax rates. For Box One, the rates are progressive, starting at 8.1% and going as high as 49.5% on income over EUR 78,426 (USD 89,400). 

Box Two has two separate rates: 

1. 24.5% on income below the EUR 68,843 (78,500) threshold
2. 31% on income above the same threshold

Income in Box Three is taxed at a flat rate of 36%. 

Countries With the Highest Property Taxes

While most countries have a one-off property transfer tax you should account for when purchasing property, they can also have a yearly property tax that can create a recurring expense or diminish the income from your rentals. 

The countries with the highest property tax rates in the world include:

• Morocco: 10%–30% of the annual rental value, with progressive rates based on the rental value; certain reductions and exemptions may apply
• Taiwan: 1%–5.5%
• South Korea: 0.06%–2.4%, depending on the type of immovable property
• Lithuania: 0%–1%

Bonus read: Learn more about countries without a property tax.

Countries With the Highest Sales Tax/VAT Rates

Both the sales tax and the value-added tax (VAT) are taxes on consumption. The key difference is that sales tax applies to the end consumer of a good or service, while VAT applies to every part of the supply chain.

Sales taxes are often used by countries that don’t have an income tax to finance their budget. However, those countries are typically not the ones with the highest sales tax/VAT. 

The top sales tax/VAT rates in the world are in the following countries:

• Hungary: 27%
• Finland: 25.5%
• Sweden, Denmark, Norway, Croatia: 25%
• Estonia, Greece, Iceland: 24%

How Do High-Net-Worth Individuals Reduce Taxes When Moving Abroad?

Most countries tax based on residency, allowing you to stop being a tax resident once you relocate. A small number of countries are exceptions—most notably, the U.S. taxes its citizens regardless of where they live, on top of the taxes applied in the new home country. 

If you’re a high-net-worth individual planning to move abroad, including into one of the high-tax countries, you can reduce your tax bill by: 

• Leveraging tax residency rules: You will typically need to meet a minimum physical presence requirement in your host country to qualify as a tax resident
• Using tax treaties to avoid double taxation: If two countries claim you as a tax resident, these treaties can determine which country has primary taxing rights
• Structuring your assets: Vehicles such as trusts and holding companies allow you to manage cross-border assets more efficiently 

Minimizing your tax exposure when moving abroad requires careful planning, especially if you intend to own cross-border assets. With more than one jurisdiction involved, the risk of error increases, potentially leading to higher tax bills, frozen assets, or penalties for non-compliance that can surface years after the move. 

Working with a reputable advisory company can mitigate many of these risks. For assistance from a company with experience in both residency acquisition and tax mitigation, contact Nomad Capitalist.

Reduce Your Tax Liability Legally With Nomad Capitalist

Nomad Capitalist is a consulting firm specializing in global mobility and wealth preservation. We’ve helped more than 1,500 clients reduce their tax liability, obtain a second residency or citizenship, and explore investment opportunities abroad. 

Our flagship service is the Action Plan, a step-by-step guide to achieving your financial and lifestyle goals. We take your current situation as the starting point and your desired outcome as the objective, and we create a strategy to get you there efficiently and cost-effectively. 

Here’s what partnering with Nomad Capitalist entails: 

1. We ask you to fill out a form to help us determine whether we’re a good match
2. We schedule a 45-minute onboarding call to learn more about your circumstances and goals
3. Our agents create an Action Plan and present it to you for approval
4. We implement the Plan over a year-long period, and manage the administrative parts
5. You continue receiving support from us even after the Plan is implemented

If you’re considering relocation to a different country for tax purposes, Nomad Capitalist can help you with every step of the process. We can devise a strategy for you and help you choose the country that best fits your needs. We can also manage the process of obtaining legal rights to reside in the country, and advise you on structuring your assets to optimize your tax liability. Get your Action Plan today!