A progressive tax system imposes higher tax rates on individuals with higher incomes, aiming to reduce income inequality by ensuring that those who earn more contribute a larger share of their earnings in taxes.​InfoGuide Nigeria

According to a 2024 report by Ireland's Department of Finance, Ireland's tax and welfare system achieves the most significant reduction in income inequality among OECD countries. The report highlights that while Ireland's pre-tax income inequality is relatively high, the application of taxes and benefits substantially decreases this disparity. This indicates that Ireland's tax system effectively redistributes income, embodying a high degree of progressivity. ​The Irish Times+1Wikipedia+1Latest news & breaking headlines

In 2018, the OECD's "Taxing Wages" report noted that Ireland had one of the lowest average tax rates among its member countries. For instance, a single worker in Ireland paid an average tax rate of 19.4%, compared to the OECD average of 25.5%. Additionally, the report highlighted that Ireland's personal tax system was among the most progressive in the OECD, as evidenced by the significant reduction in income inequality after taxes and benefits were applied. ​WikipediaLatest news & breaking headlines+1The Irish Times+1

Other countries also employ progressive tax systems. For example, Sweden has a top marginal income tax rate of 57.1%, and Denmark's reaches 55.9%. These high rates fund extensive social welfare programs, contributing to income redistribution. However, the effectiveness of a tax system's progressivity depends not only on tax rates but also on how the collected revenue is utilized to address income inequality.​ International Wealth+1InfoGuide Nigeria+1InfoGuide Nigeria+1International Wealth+1

In summary, while several countries implement progressive taxation, Ireland's system stands out for its effectiveness in reducing income inequality, as evidenced by OECD data and national reports.

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