Home/Council briefs/16 April 2026
Team Council · Council brief
Taxing Wages 2026: the cost of a first employee
OECD figures show that the tax wedge on labour varies widely across countries. Reseated’s early Team Council reports point to a practical question for small employers: what does it take to make the first formal hire affordable and predictable?
What happened
The OECD’s Taxing Wages 2026 report gives an average tax wedge of 35.1% across OECD countries for 2025 and reports substantial differences among individual countries.[1]
- The OECD reports a 2025 average tax wedge of 35.1% across OECD countries.
- The country figures in the dossier range from 20.8% in New Zealand to 49.3% in Germany, with France, Italy, Spain, Sweden and the Netherlands also listed.
- Reseated’s Team Council has recorded 14 reports from six countries, all concerning hiring costs, as of 16 April 2026.
What it means for small businesses
The cost of taking on an employee is shaped by national rules, so a single average cannot tell an owner what their own first hire will cost.
For small employers, uncertainty and administrative burden can make formal hiring difficult alongside the direct costs.
Reseated’s early reports identify a concern worth examining, but their small number is not a representative measure of all small businesses.