Denmark has the highest tax rate in Europe – but is also one of the world’s happiest (Image: Getty)
In what appears to be a perfect contradiction in terms, the country with the highest tax in Europe is also among the happiest in the world.
Tax burdens across Europe vary hugely – but Denmark stands out as the highest taxing country on the continent, with a personal income tax rate of 55.9 percent. But almost all of the people of Denmark are happy to pay it.
This is because of the country’s incredible welfare, healthcare and education systems that almost all its citizens are happy to contribute to. Coming in close behind Denmark is Austria at 55 percent, Portugal at 53 percent, Sweden at 52.3 percent and Belgium at 50 percent.
Denmark has the highest taxes in Europe (Image: Getty)
The UK, meanwhile, is not far behind at 45 percent.
The figures vary hugely though, with Romania, Bulgaria, Bosnia and Herzegovina, Kosovo and North Macedonia all having equivalent tax rates of just 10 percent.
According to a Gallup survey from 2014, almost nine out of 10 Danish people are happy to pay their taxes.
This has largely been attributed to a culture in which citizens consider the payment to be an investment in the collective future of the country and society.
Copenhagen in Denmark (Image: Getty)
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Denmark was ranked the second happiest country in the world for the fourth year in a row, according to the 2023 World Happiness Report.
The well-developed welfare system means that all areas of Danish society are able to take advantage of the same opportunities – regardless of their gender, socio-political or economic standing.
Most education, especially higher education in Denmark is free – and college students even receive a grant from the Danish government of around $900 (£712) a month. As a result, parents don’t have to worry about financing their children’s education, while students leave it without the constant additional tax of student finance on their back for much of their working lives.
Denmark is one of the happiest countries in the world (Image: Getty)
This support continues into the workplace. Parents are entitled to 52 weeks of parental leave – 32 of which are paid by the state.
The Danish labour market model has also been tipped as key to their happiness.
Dubbed the flexicurity model, it is based on flexibility for employers, security for workers and an active labor market policy. It allows companies to adapt to changes and stay in business, while providing a clear safety net for workers and the unemployed.
The active labour market policy aims to keep both the employed and unemployed active and skilled. For those in work, skill development is readily available.
For those unemployed, there are services to assist with the job search, to keep them on the hunt.
As a result of all this, Danes are perfectly content to pay their share of taxes, due to the quality of public services they receive in return.
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