Originally invented by an American businessman, economic think tanks in many countries use Tax Freedom Day to illustrate how much tax people are paying in everything from income tax to VAT to property tax.
Tax Freedom Day marks the time every year when the average person has theoretically earned enough money to pay the taxes they can expect for that year.
The time after Tax Freedom Day is then used to illustrate how much leftover income the average person then has to support themselves.
Tax Freedom Day in 2023 fell on August 15th in Austria – much later than in many other countries.
READ ALSO: Everything you need to know about filing taxes in Austria
Canadian Tax Freedom Day fell on June 19th this year, while the UK marked it one day earlier on June 18th. American Tax Freedom Day in 2023 came significantly earlier – on May 14th.
In many other European countries, Tax Freedom Day typically falls in June. These include Spain, Sweden, and the Netherlands, among others. A fair few EU countries have their Tax Freedom Day in July, including neighbouring Germany, where it occurred on July 21st this year.
In the EU though, only Belgium and Austria typically have their Tax Freedom Days in August.
It‘s August
— Alex Kirchmaier | web3alex.eth ? (@0xSchnitzel) August 6, 2023
Somewhen during the next 2 weeks we have the honour to celebrate the Tax Freedom Day here in #Austria.??
Last year the day fell on 15th August.
It should be a reminder that we worked for @karlnehammer‘s government until now.@WKOe @AgendaAustria#TaxFreedomDay2023 pic.twitter.com/unD0FLIAoq
Both the far-right Freedom Party (FPÖ) and the liberal NEOS say Austria’s late date demonstrates that the tax burden for people living here is simply too high.
“People work for the state until August 15th and only from then on do they keep their money in their own pockets,” said NEOS economic spokesperson Gerald Loacker. “Austria is absolutely a high-tax country, in which work in particular is overburdened.”
“The average taxpayer has been toiling away working for the finance minister for seven months and 15 days,” said FPÖ economic spokeswoman Dagmar Belakowitsch.
The Austrian Economics Center, which calculates Tax Freedom Day in Austria, finds that wage taxes and social charges are particularly high in Austria – almost 47 percent of the average salary. When this is added to other taxes like VAT and property tax, Tax Freedom Day gets pushed into the second half of the year. The Center estimates that about 62.7 percent of what people in Austria earn gets funnelled back to the treasury through a tax of some sort.
The Center says Tax Freedom Day in Austria has been getting pushed later and later for a number of years now, advocating social charges on wages to be reduced to allow workers in Austria to keep more of the money they earn.
Austrian Tax Freedom Day has fallen in August for the last three years, with the day coming on July 31st in 2020.
"Tax Freedom Day 2023 clearly shows the ongoing need to review the tax burden in Austria and to make government spending more efficient," the Center wrote in a release.
READ ALSO: How much money could tax changes save workers in Austria next year?
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