Tax revenues in cash terms fell last year while the tax burden as a share of gross domestic product also fell in most Organisation for Economic Co-operation and Development member countries, figures from the Paris-based organisation show.

Tax revenues as a share of GDP reached the lowest level since the early 1990s, the organisation said. In 2007, the tax burden was 35.4 per cent, then dropped to 34.8 per cent in 2008, and fell again in 2009 to an estimated 33.7 per cent, the OECD said, basing data on figures from 28 countries.   

The data does not, however, go into the specifics of different tax rates, a crucial issue for wealth management as many high net worth individuals are now facing rising rates, bringing greater demand for tax structuring. In the UK, for example, there is now a top rate of income tax on incomes of £150,000 (about $233,000) a year, as well as an annual levy on non-domiciled residents.

The report did also not spell out why tax burdens fell. The data, however, was drawn during a period of economic crisis and falling growth, which means that revenues probably fell even in spite of, or perhaps because of, rising marginal tax rates.

The organisation said that tax-to-GDP ratios have fallen for two consecutive years in almost half of the countries and for three consecutive years in Canada, France, Iceland, Ireland, New Zealand, Norway and the UK. Tax revenues fell in cash terms in 2009 in all countries except Luxembourg, Switzerland and Turkey.

Denmark has the highest tax burden, closely followed by Sweden. The Danish tax burden was 48.2 per cent in 2009, closely followed by Sweden at 46.4 per cent. Austria, Belgium, Finland, France, Italy and Norway also have tax burdens over 40 per cent. Mexico, with a 17.5 per cent tax to GDP ratio, and Chile, with 18.2 per cent, have the lowest tax to GDP ratios amongst OECD countries, followed by the US at 24.0 per cent.