Economic planet | Pay taxes, happiness!

Does paying taxes make you happy? One could believe this, seeing below the classification of countries that consider themselves the happiest.

Posted at 9:00 am.

Helen Baril

Helen Baril

Year after year, Finland and the Scandinavian countries rank first among the world’s happiest countries. The taxpayers of these countries also bear one of the highest tax burdens. This annual ranking, called the World Happiness Report, is produced by the Sustainable Development Solutions Network, an independent initiative of a group of experts from all walks of life, including economist Jeffrey Sacks, under the auspices of the United Nations.

The exercise may seem useless, but it’s not that much. The ranking uses Gallup’s global data on people’s perceptions of quality of life, and then compares it to official statistics such as life expectancy, educational attainment and gross domestic product per capita. .

The results of this annual event, which has been running for 10 yearsas well as year are of great interest to a growing number of leaders who believe that the well-being of the population should be a more important task for governments than increasing GDP.

In Quebec, a group of economists, academics and employer and trade union representatives, the G15+, are currently working on a “happiness index” based on 51 measures of individual and collective life to measure and improve people’s well-being. Population.

A few changes in my head

The global happiness charts for 2022 are not much different from the previous year, despite the pandemic sweeping the planet. Finland holds the top spot for the fifth year in a row. All Nordic countries top the list of 150 countries. The three countries that moved up in the rankings are Serbia, Bulgaria and Romania. Lebanon, Venezuela and Afghanistan were the hardest hit.

Canada is in the same place as in the previous ranking, well asbut has been falling sharply for several years, as it already ranks fifth in the world charts of happiness.

What is evident in the World Happiness Report rankings is that the top ranked countries are the countries with the highest tax burden. High taxes make it possible to provide quality services to the population, which contributes to improving the well-being of the population. This is also a feature of the Nordic countries, where health and education systems are considered the best in the world.

Another observation: countries top 10 small countries with relatively small populations. The two characteristics are related because it is easier to maintain a fair and progressive tax system that guarantees social peace in smaller societies.

Year after year, the authors of the World Happiness Report note that the level of social cohesion and the reduction of inequality play a major role in determining the happiness of the population.

wealth factor

It should be noted that wealth also plays an important role in the equation. The happiest countries are not the richest, but their GDP per capita is among the highest among OECD countries, with the exception of Luxembourg, where the importance of the financial sector and small population will unbalance the statistics.

Happiness is not in money, we know that. Canada and Finland have similar GDP per capita, but they are separated by 15 rungs on the happiness scale.

Many studies have shown that above a certain level, an increase in income does not lead to any additional well-being. This has been called the Easterlin paradox, after an American economist who studied the relationship between money and happiness.

Money can’t buy happiness, but it certainly does. At the other end of the happiness and wealth scale, the relationship between money and happiness is direct. The countries that have fallen the most in the 2022 rankings, Lebanon, Venezuela and Afghanistan, are countries that are facing a major economic crisis. And those who are least happy, year after year, remain among the poorest countries in the world.

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