The Organization for Economic Cooperation and Development (OECD) publishes an annual Revenue Statistics Report comparing the tax situations of the world’s economies. The report also shines light on economic climates and how citizens shoulder their respective tax burdens. Based on information in the 2010 Revenue Statistics Report,Mexico reigns at the top as the lowest taxed country.
Many of the world’s largest economies have an aggregate tax burden between 35% and 36%. This percentage is the ratio of total tax revenue to gross domestic product (total market value of goods and services produced in the country). A higher percentage means more tax responsibility to the citizens. Mexico’s aggregate tax burden is a meager 21.1% in comparison.
Mexico was also ranked as the best place to do business by the KPMG,one of the largest accounting firms in the world. Their report acknowledged Mexico as the best of 95 cities in 10 developed countries from an overall tax standpoint. Mexico’s low cost of living has attracted plenty of attention from the United States,Canada,and other places around the world. More American retirees move to Mexico than to any other country,and a lenient economic system may take credit.
Property taxes are low here and quality medical care is much more affordable than in the United States. Many of their doctors were trained in the United States before moving their practice to Mexico. Though the best health services are provided through privately funded systems,there are public and employer-sponsored programs available to everyone. Citizens also have lower expenditures toward the public health care system than in most other countries.
Other countries following Mexico in the lowest tax burdens were Turkey with 23.5%; South Korea at 26.6%; the United States with 26.9%; and Ireland,ranked fifth with a 28.3% aggregate tax burden.
Just one more reason to why investing in Mexico is a smart choice.