The taxman cometh. But for many, his burden is heavier than ever.
In the annals of global fiscal regimes, Côte d’Ivoire stands out for its citizens’ exorbitant income tax burden. In the latest reckoning by World Population Review, the West African nation claims the dubious honour of levying the highest such rates on earth.
Though Côte d’Ivoire’s sales and corporate taxation schemes register as relatively mild compared to other nations’ levies, its income taxation system eclipses those of even the most affluent and advanced societies. At a staggering 60%, these taxes weigh heavily upon the shoulders of Ivorian earners.
Only Finland (56.95%), Japan (55.97%), Denmark (55.90%), and Austria (55%) came close to Côte d’Ivoire to round up the top five countries with the highest income tax out of 150 surveyed countries.
Surprisingly, no other African nation cracks the top ten in personal income tax rates. But that’s not yet enough to celebrate. Chad (35%), Equatorial Guinea (35%), Guinea (35%), Sudan (35%), and Zambia (35%) all claim spots among the most heavily taxed business environments worldwide.
The Ivorian taxman is no mere abstraction but a concrete reality for those who live and work in Côte d’Ivoire. As residents of the West African nation know all too well, income tax is levied through a mix of specific direct income taxes and general income taxes. For those who earn a salary, this translates to a 1.5% tax on 80% of gross income, while national contribution is taxed at progressive rates ranging from 1.5% to 10%, depending on varying tax brackets.
PwC’s Worldwide Tax Summaries provide a useful primer on the Ivorian tax system, which extends to a variety of sources of income, including labour, pensions, interest, and dividends. But for the Ivorian government, these taxes are not merely an abstraction; they represent a critical source of revenue for the country.
Despite its onerous tax regime, Côte d’Ivoire remains an economic bright spot in Africa. While its the world’s largest cocoa producer, the country has long been a major exporter of cashew, coffee, and palm oil. It also boasts significant offshore oil and natural gas reserves that have helped to boost government revenues.
Côte d’Ivoire also achieved an impressive 7% growth rate in 2021, following the economic slowdown caused by the COVID-19 pandemic in 2020. So there are reasons for investors and business leaders to be optimistic about it.
Yet Côte d’Ivoire is not alone in its high-tax approach. South Africa, Uganda, and Senegal are just a few of the other African nations that rank among the highest-taxed countries in the world, according to the World Population Review survey. Meanwhile, Libya, Seychelles, and Mauritius are among the nations with the lowest tax rates.
And for those looking for tax havens, the usual suspects remain at the top of the list. Luxembourg, the Cayman Islands, and the Isle of Man are just a few of the locales where the taxman is not so vigilant. But for most of us, taxes remain an inescapable fact of life, no matter where we call home.