The taxman is coming. But for many, his burden is heavier than ever.
In the annals of global tax regimes, Ivory Coast stands out for the exorbitant tax burden of its citizens. In the last settlement by World Population Reviewthe West African nation claims the dubious honor of levying the highest such tariffs in the world.
While Côte d’Ivoire’s sales and corporate tax regimes are relatively lenient compared to other countries’ levies, its income tax system exceeds that of even the most affluent and advanced societies. At one stunning 60%these taxes weigh heavily on the shoulders of Ivorian earners.
Only Finland (56.95%), Japan (55.97%), Denmark (55.90%) and Austria (55%) came close to Ivory Coast for the top five countries with the highest income taxes out of 150 surveyed countries to complete.
Surprisingly, no other African country cracks the top ten in income tax rates. But that’s not enough to celebrate. Chad (35%), Equatorial Guinea (35%), Guinea (35%), Sudan (35%) and Zambia (35%) all claim to be among the most heavily taxed business environments in the world.
The Ivorian taxpayer is not just an abstraction, but a concrete reality for those who live and work in Ivory Coast. As residents of the West African country know all too well, income tax is levied through a mix of specific direct income taxes and general income taxes. For those earning a salary, this translates into a 1.5% tax on 80% of gross income, while the national contribution is taxed at progressive rates ranging from 1.5% to 10% depending on different tax brackets .
PwC’s global tax statements provide a useful introduction to the Ivorian tax system, which extends to a variety of sources of income, including employment, pensions, interest and dividends. But for the Ivorian government, these taxes are not just an abstraction; they represent a critical source of income for the country.
Despite its heavy tax regime, Ivory Coast remains an economic bright spot in Africa. Although it is the largest cocoa producer in the world, the country has long been a major exporter of cashews, coffee and palm oil. It also boasts significant offshore oil and natural gas reserves that have helped boost government revenues.
Ivory Coast 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 Ivory Coast is not alone in its approach to high taxes. South Africa, Uganda and Senegal are just a few of the other African countries ranked among the highest taxing countries in the world according to the World Population Review survey. Meanwhile, Libya, Seychelles and Mauritius are among the countries with the lowest tax rates.
And for those seeking tax havens, the usual suspects remain at the top of the list. Luxembourg, the Cayman Islands and the Isle of Man are just some of the places where the taxpayer is not so vigilant. But for most of us, taxes remain an inescapable fact of life, no matter where we live.