On 25 July 2023 the OECD issued Revenue Statistics in Asia and the Pacific 2023, setting out revenue data for the region from 2021. The latest edition of the annual publication includes data on tax revenues for 30 jurisdictions in the region and includes Armenia and Georgia for the first time.
The statistics indicate that the tax-to-GDP ratios remained below pre-pandemic levels in most of the countries of the Asia-Pacific region in 2021. However, the data shows that in the second year of the pandemic the tax-to-GDP ratios increased in 19 of the 27 jurisdictions of the region for which data is presented, although the ratios only recovered to pre-pandemic levels in 11 of the 27 economies.
Where the tax-to-GDP ratio rose in 2021, the reason was that the tax revenues were increased by a recovery in in international trade, combined with higher commodity prices and the easing of travel restrictions in some places. In the jurisdictions where the tax-to-GDP ratio declined, the effects of the crisis caused by the pandemic continued to depress tax revenues. Generally, the recovery in average tax-to-GDP ratios was weaker than in other regions of the world in 2021, rising on average by 0.2 percentage points to 19.8%, following a decrease of 0.9 percentage points in 2020.
In 2021 tax-to-GDP ratios across the Asia Pacific region ranged from 36.6% in Nauru to 9.7% in Lao PDR. Countries with high tax-to GDP ratios included New Zealand (33.8%); Japan (33.2%); Korea (29.9%) and Australia (28.5%). Among the countries with the lowest tax-to-GDP ratios were Singapore (12.6%); Malaysia (11.8%); Indonesia (10.9%); and Pakistan (10.3%). It should however be noted that the ratios for Lao PDR and Malaysia did not include sub-national tax as the relevant data was not available for the study. Apart from Nauru, all the tax-to-GDP ratios were lower than the OECD average for the year which was 34.1%.
Tax structures in Asia and the Pacific
The main source of tax revenues in the Asia-Pacific region in 2021 was from taxes on goods and services, bringing in 51.6% of total tax revenues. Of this amount, VAT and GST contributed on average 25.6% of total tax revenue while taxes derived from other goods and services (e.g. excise taxes and import duties) generated the largest share of total tax revenues (26.0%) in the region in 2021.
Revenue from personal income taxes represented 16.5% of total tax revenues on average in Asia Pacific in 2021. Corporate income taxes accounted for 18.2%, and social security contributions brought in a smaller proportion of tax revenues at 6.9% on average.
Recurrent taxes on property
The latest report also presents a special feature looking at recurrent taxes on property in Asia. This sets out the level of revenues generated by these taxes in Asia and looks at the tax base for the property taxes and the methods of administration. The report considers the constraints on recurrent property taxation in the region and presents some options for how these issues could be resolved.
