Most countries reduce income inequality through taxes and transfers — taxing higher incomes more, and redistributing through benefits like pensions, unemployment support, and family allowances.
But how much each country reduces inequality varies a lot, as you can see in the chart.
This data comes from the OECD Income Distribution Database (IDD), one of the few internationally harmonized sources that measures income inequality both before and after taxes and transfers.
I recently updated our charts with the latest release from the OECD, which now covers 45 countries (OECD members plus select non-members) with annual data going back to 1976.
The OECD updates the IDD on a rolling basis, and we plan to refresh our charts annually.
What you should know about this indicator
- Income has been equivalized — adjusted to account for the fact that people in the same household can share costs like rent and heating.
- The entire population of each country is considered, and also the income definition is the newest from the OECD since 2012. For more information on the methodology, visit the OECD Income Distribution Database (IDD).
- Survey estimates for 2020 are subject to additional uncertainty and are to be treated with extra caution, as in most countries the survey fieldwork was affected by the Coronavirus (COVID-19) pandemic.
“Data Page: Reduction in income inequality before and after tax”, part of the following publication: Joe Hasell, Bertha Rohenkohl, Pablo Arriagada, Esteban Ortiz-Ospina, and Max Roser (2023) – “Economic Inequality”. Data adapted from OECD. Retrieved from https://archive.ourworldindata.org/20260518-093348/grapher/reduction-in-income-inequality.html [online resource] (archived on May 18, 2026).
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