In 2025, a new ranking was published that clearly shows how much employers in different European countries have to pay for their employees to receive an annual income of $60,000 (approximately €51,000 at the current exchange rate). The study covered European Union countries and allowed for a comparison of the tax burden on businesses in terms of wage costs.
France leads in the amount of mandatory payments. Here, for an employee to take home just under $40,000 (about €33,800), a company must spend more than $95,000 (€81,500). This means that almost $55,000 goes to taxes and social contributions.
Italy is in second place. Italian employers allocate over $88,000 (€75,600) per employee with a similar gross salary, but the employee actually receives less than $36,000 (about €30,800). The gap between company expenses and the employee’s net income is also quite significant.
Slovakia takes third place in the ranking. Here, for an employee to receive just over $40,000 (€34,300), a company spends more than $81,000 (€69,400). Thus, nearly half of the total amount goes to mandatory state payments.
Spain ranks sixth among European countries in terms of payroll tax burden. To provide an employee with a gross salary of $60,000, a Spanish employer must spend almost $80,000 (€68,000). However, the employee receives only $40,000 (€34,000) net, which is exactly half of the company’s total expenditure. The rest goes to taxes and social contributions.
Portugal also made the top ten countries with the highest tax burden. Here, the employer spends over $75,000 (€64,500), but the employee receives less than $35,000 (€29,500). The remaining amount goes to the state budget and social needs.
The ranking data highlights that in most European countries, a significant portion of employers’ personnel costs goes to taxes and contributions. This affects both employees’ net incomes and business competitiveness.
For comparison, some European countries have a significantly lower tax burden on salaries, allowing employees to receive a larger share of what the employer spends. However, in Spain, France, Italy, and several other countries, half or even more of the total amount goes to mandatory payments.
Experts point out that this situation creates specific challenges for the labor market and may influence companies’ hiring decisions, as well as the country’s attractiveness for investors and professionals.
