Taxes and Public Spending

Nordic governments collect a large share of national income in taxes, mostly from broad taxes on income and consumption, rather than only from the rich.

Who pays for all those services?

Size

Tax revenue is around 40 to 45 per cent of GDP in the largest Nordic economies.

Broad taxes

High value-added taxes and payroll taxes hit the middle class, not only the wealthy.

Efficiency

Broad bases with fewer loopholes are more efficient than narrow high rates.

Trust

People accept taxes because they see quality services in return.

A bill in Denmark

A shopper pays a 25 per cent VAT on most goods.

Assuming only the rich pay for the Nordic state

The middle class pays a lot.

Key takeaways

Taxes are around 40-45% of GDP.
Broad taxes fund services.
Loopholes are limited.
Trust supports compliance.