Tax Revenues As A Percentage
Gross Domestic Product

Selected Years


Are Americans taxed too heavily. Not according to these figures calculated by Louis A. Ferleger and Jay R. Mandle and reported in No Pain, No Gain (1992).

Tax Revenues As Percent
of GDP
197019751980 19851989
United States29.2 29.029.5 29.230.1
Japan 19.720.925.4 27.630.6
OECD33.134.637.0 39.039.5

What do these figure mean?

Ferleger and Mandle point out that there is no correlation between the rate of increase of taxes and productivity growth, as the following table suggests.

Average Annual Increase in Total
Factor Productivity 1973 to 1990 and
Increase in Tax Revenues
as a Percentage of GDP,
1975 to 1989
Productivity
growth
Tax Revenue
increase
United States 0.0 1.1
Canada 0.5 2.9
Australia 0.7 2.5
Austria 1.0 2.4
United Kingdom 1.1 1.0
Netherlands 1.2 2.3
Germany 1.3 2.4
Denmark 1.3 8.5
Belgium 1.5 2.5
France 1.7 6.9
Japan 1.7 9.7
Italy 1.8 11.6
Sweden 0.6 12.5

Interpretation


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H. T. Reynolds
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