Part 1 - AL-Tax

International Taxation Handbook11.3 Tax reformTable 11.3 measures the increase or decrease in tax misery from 2000 to 2005 for theAsian economies that were included in the Forbes data. However, the numbers donot provide a good direct comparison. For example, the increase for China is for theperiod 2001–2005, which includes just five years rather than six. Some other Asianeconomies were included in the index only after 2000. Table 11.3 shows whetherthe various Asian economies have increased or reduced their tax pain over time.11.4 Happiness IndexAnother micro approach to public finance is to compare the gross to net salaries thatemployees in various income categories earn. Forbes calls this measurement theHappiness Index.Table 11.4 shows the relationship of gross to net salary for married employeeswith two children who earn €50,000. The net salary is what employees receiveafter income tax and the employee share of social security taxes are deducted.The higher the figure, the happier the employee. The table includes all the Asianeconomies that were included in the Forbes data plus a selection of developedcountries for comparison purposes. Since the tax system in the USA is at threeTable 11.3Change in tax misery 2000–2005, Asian economiesRank Country Tax misery Incr. (decr.)2005 2004 2003 2002 2001 2000 2000–20052 China 160.0 160.0 160.0 154.5 156.0 4.018 Japan 123.3 121.5 124.9 117.3 117.2 123.6 (0.3)21 Turkey 118.3 126.5 124.5 (6.2)34 South Korea 100.8 100.7 99.8 102.5 103.0 (2.2)36 Australia 97.5 88.5 90.0 88.5 9.043 Indonesia 89.0 89.0 80.7 80.7 8.344 Malaysia 89.0 89.0 89.0 047 India 84.0 80.0 79.3 79.3 79.0 5.048 Thailand 84.0 83.0 83.0 1.049 Taiwan 82.1 82.1 81.7 0.452 Singapore 79.0 80.0 87.0 93.5 (14.5)55 Hong Kong 43.5 43.0 43.0 41.0 2.5274