Budget 2025: From 37% in US to 48% in Scotland – these are the maximum income tax rates in other countries

Budget 2025: In India, the maximum income tax rate is 30 percent for those in the highest income bracket before a surcharge of up to 25 or 37 percent depending on which regime (new or old) and a 4 percent cess on the combined figure.

In Budget 2023, the government had cut down the maximum surcharge from 37 percent to 25 percent for those filing returns as per the new tax regime.

This practically inflates the total income tax rate to 39 percent in the new tax regime or 42.7 percent in the old tax regime.

Let us compare these tax rates to the income tax charged by the governments in other countries.

Income Tax: Highest rates levied by developed countries

USA: The tax rates range between 10 percent to 37 percent depending on how much you are earning. The highest income tax rate is applied on the earnings above $609K (equivalent to around ₹5.3 crore), reveals the latest figures on IRS.gov.

For those earning up to $58,000, the maximum income tax rate is 22 percent.

UK: UK has income tax rates which range between 0 percent to 45 percent. Those earning over £125K are meant to pay over 45 percent.

In Scotland (also part of the UK), tax rates are slightly on the higher side. Starting from 19 percent for those earning above £12,571, the maximum rate goes up to 48 percent on earnings above £1,25,140 (equivalent to ₹1.37 crore), reveals the British government’s official portal.

Those earning between £75K to £125K, tax rate is 45 percent.

Australia: Australia charges a maximum of 45 percent on income above $190,000 (equivalent to ₹1.02 crore) and there is a 2 percent levy towards ‘medicare’ which inflates the maximum rate to 45.9.

Germany: Maximum income tax rate in Germany is 45 percent for income above 5,55,652 euros (around ₹5 crore) for married persons and 2,77,826 (around ₹2.5 crore) for single taxpayers.