Study by the IEM (in collaboration with Ernst & Young) / July 2016
The purpose of this study is to compare the tax and social security burdens of
individual employees earning typical salaries in each of the 28 member states
of the European Union and, in doing so, to determine a “tax liberation day” —
measuring how much of each year’s work is devoted to paying taxes — for
workers in each country.
In addition, the study tracks year‐to‐year trends in both the taxation on, and
cost of salaried labour in the EU‐28.
Numerous studies rank political systems by various measures of “economic
freedom”. While valuable to economists, the aggregate data in these studies
fail to shed light on the working individual’s role in financing their state and
In addition, many organizations determine an annual “tax freedom day” for
their countries. Unfortunately, conflicting approaches to this calculation make
cross‐border comparisons difficult.
This study aims to create an “apples to apples” comparison of tax rates, with
data that reflect the reality experienced by real, working people in the
European Union. Finally, it serves as a guide to the true cost of hiring
employees in each member state.