Your nation's tax rate is the percentage of your citizen's individual income that you take each day as taxes. For example, a tax rate of 25% when your citizens earn $100 would give you $25 a day per citizen. This number is multiplied by your total number of citizens (not including soldiers) to give the amount you earn daily in taxes.
It is almost always best to set your tax rate to 28%. The tax rate may be changed in the "Edit my Nation" page.
Effects of the tax rateEdit
Lowering your tax rate lowers the percentage of taxes each of your citizens pay on their income but increases your population happiness. The happier your population is the more money they will make, so sometimes lower tax rates will earn you more money than would a higher tax rate.
|Tax rate||Effect on Population happiness|
|10% - 16%||none|
|17% - 20%||-1|
|21% - 23%||-3|
|24% - 25%||-5|
|26% - 28%||-7|
Despite how 'angry' your citizens may get about the amount they are paying, there are no other negative effects to a higher taxation rate.
Best tax rate Edit
Most older nations keep their tax rates fixed at 28%, but early on in the game a lower tax rate may be advantageous. You can adjust your tax rate as much as you like, so set it at different values, looking to maximize the Avg. Individual Income Taxes Paid Per Day. To quickly find your ideal tax rate:
- Set your tax rate to 10% (you can change it back later)
- Check your Avg. Gross Income Per Individual Per Day
- Set your tax rate to the percentage listed in the below table.
- Repeat if your Population Happiness level changes.
Income Per Individual Per Day
(at 10% tax rate)
Ideal Tax Rate 0.00 - 10.00 16% 10.01 - 32.66 20% 32.67 - 50.80 23% 50.81+ 28%
Note that 25% is never a good choice.
Collecting taxes and interest Edit
Taxes can be collected once per day, and if they are not collected they are accrued and can be claimed the next day instead. If you choose not to collect taxes, you will earn interest (at a rate of 12%) on your AVAILABLE cash, not your uncollected taxes. There is a maximum interest of $10,000.
- It says my citizens are angry with my current tax rate. Should I change it?
- No, not if it is making you enough money. The only effect of your citizens being angry is a decrease in happiness, and since happiness only affects income as long as you're getting the most money you can, it's fine to keep the tax rate the same. No matter how angry your citizens get, they will not riot and there will be no negative effects.
- Is it cheating to change my tax rate to 28% just before collecting taxes and then change it back to 10% just after collecting taxes?
- It's true, a lower tax rate will improve population happiness. However, the only factor that is affected by population happiness is your population's taxable income. The only time that your population's taxable income comes into play is when you collect taxes. If you lower right afterwards it will make the population happier So no, it's not cheating.
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