The Republic remains the lowest taxed state as a proportion of gross domestic product (GDP)in the EU.

According to 1997 figures published yesterday by the OECD, the Republic had the eighth lowest tax take in the 25-nation OECD, with taxes representing 34.8 per cent of GDP in 1997, up slightly from 33.7 per cent in 1996.

Only Mexico, Korea, Turkey, Japan, the US, Australia and Iceland have a lower take, with Mexico only taking 16.9 per cent last year. The countries with the highest taxes over 45 per cent of GDP are Denmark, Sweden, Finland, Belgium and France.

Final figures for 1996 reveal that the EU average was 42.4 per cent, higher than any other region, while the OECD America region had an average of only 27.2 per cent.

The figures show the Republic is very reliant on income tax, which accounted for 40.9 per cent of the total tax take in 1996, the latest year that full figures are available, compared to an EU average of 34.2 per cent and an OECD average of 35.3 per cent.

However, PRSI or social security taxation is at one of the lowest rates, in the Republic, at 13.5 per cent of total taxes collected, compared to an EU average of 28.9 per cent and an OECD average of 25.1 per cent.