Highly Qualified Individuals

The BAK Taxation Index for highly qualified individuals measures the tax burden for a single worker without children and an after-tax income of EUR 100,000. All of the tax types and provisions relevant at a location are taken into account. In doing so, the incidental salary costs with a tax-like character are also considered both from the perspective of the employer as well as the employee. The resulting tax rate shows the tax burden as a percentage of gross wages for a net income (after-tax income) of EUR 100,000. The tax burden on the gross salary for highly qualified individuals is a central cost factor for corporations, and therefore, as with the corporation tax burden, an important criterion for a corporation’s decision when selecting a location.


BAK Taxation Index for Highly Qualified Individuals 2019

Notes: Effective average tax rate (EATR) applicable to highly qualified employees in Swiss cantons (calculated for the cantonal capital) and at international business locations (calculated for the economic capital) in % (cf. blue pillars or 4th column); the standard case depicted here is based on an unmarried individual without children with an income after taxes of EUR 100.000. In/decrease from 2017 figures in percentage points (cf. third column), excluding fluctuations in exchange rates and inflation. In the case of the Swiss cantons, the chart presents the figures for all cantons involved in the project, as well as the Swiss minimum, the Swiss maximum and the GDP-weighted average of all 26 cantons.
Source: ZEW / BAK Economics


  • Singapore leads the 2019 BAK Taxation Index for highly qualified individuals with an effective tax and fees burden of 10.4 percent; Brussels brings up the rear with 60.2 percent. In Singapore, social security is organized as a fully funded plan, which means that highly qualified individuals incur relatively modest costs. The partial lack of caps on social security contributions is the main reason responsible for the high tax burden in Brussels. 

  • The Swiss cantons are excellently positioned in the global taxation competition.

  • The BAK Taxation Index average for highly qualified employees is 37.9 percent.

  • The Eastern Europe locations show a differentiated picture. While Praha (26.7 percent), Warsaw (32.5 percent) and Bratislava (31.7 percent) can keep pace with the Swiss locations for competitive taxation, Budapest (37 percent) and Ljubljana (47.4 percent) tax their employees higher than the Swiss cantons.

  • Overall, the picture is one with a moderate tax burden in the United States (New York) and China (Beijing), a somewhat higher burden in Scandinavia, and a moderate to high burden in the rest of Europe.