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I think Americans tend to over-estimate the tax rate in Europe. California's top marginal rate (including state and payroll taxes) comes out to about 47%. It l

I think Americans tend to over-estimate the tax rate in Europe. California's top marginal rate (including state and payroll taxes) comes out to about 47%. It looks like Sweden tops out at 56%. But for that extra 9%, you get lots of services (health care, education, etc). I'd guess most Americans would take the tax hike to not worry about insurance, school loans, etc.

emj 10y ago
I'm guessing you hit the top tax faster in Sweden, the people I know with an degree will get above 50% fast, just anecdotal evidence though.
refurb 10y ago
Marginal tax rates mean nothing unless you know what the actual income brackets are. The US's hughest tax brackets kick in at almost $400K. If Sweden's kicks in at $100K, the tax burden is MuCH higher.
- brotherjerky 10y ago
  Looks like top tax bracket in Sweden is $90k -- at $90k, CA marginal is 42%. So a delta of 14% -- still probably worth it, especially at lower incomes where student loans and health care a higher percentage of earnings.
  - cmdrfred 10y ago
    The question for me is if our government doesn't provide any of those services why aren't we paying half that number?
    - brotherjerky 10y ago
      Well, you can look at the numbers here: http://www.cbpp.org/sites/default/files/styles/report_371px/public/atoms/files/3-4-16bud-policybasics_2.png?itok=fqita01H http://www.cbpp.org/sites/default/files/styles/report_371px/... Medicare, Medicaid, etc: 25% Social Security: 24% Military: 16% Safety Net Programs: 10% Federal / Veteran Benefits: 8% Looks like some people get services, just not everyone. At the state level, California: http://www.usgovernmentspending.com/California_state_spending_pie_chart http://www.usgovernmentspending.com/California_state_spendin... Health Care 35% Pensions 18% Education 16% Welfare 9% Protection (?) 7% The US does not seem to get a great return on healthcare spending.
      - iainmerrick 10y ago
        Also, US military spending is truly enormous. There is a big return on that (obviously opinions differ as to whether it's worthwhile...) (Edit for fact-checking: hmm, while the USA's military budget is by far the largest in the world, as a fraction of GDP it's not that extreme. Wikipedia says it's 3.3% of GDP, high compared to the world average of 2.3%, but way behind the likes of Israel, Russia and Saudi Arabia.)
      - cmdrfred 10y ago
        So then the question is are our elected officials corrupt or incompetent?
        Symmetry 10y ago
        The biggest problem is that the electorate doesn't trust the elected officials in this matter. To bring down healthcare costs you need to be able to reject treatments that are much more expensive but only provide slight benefits. Organizations like the NHS in Britain are very good at this. But whenever someone gestures in that direction in the US you have people up in arms about "death panels" and the idea is quickly dropped. I don't know though. Maybe if politicians just came out and said "This proposal will produce 10 extra deaths per year but we'll be saving $50bn so we think it's worth it" then people would be willing to embrace that.
        cmdrfred 10y ago
        I don't even think you are talking about more net deaths. Every percentage point you raise taxes or healthcare costs pushes a group of people underwater. A certain percent of people who have bankruptcies will commit suicide/beat their wife to death/yell at their children until they develop mental issues etc. Economic policies have consciences that are diffcult to measure.
    - eli_gottlieb 10y ago
      Because you have the vital job as an American taxpayer of subsidizing oil companies, drug companies, military contractors, investment banks, and land speculators.
temp246810 10y ago
There is so much more to taxes too then just income tax. Sales tax, vehicle tax, fuel tax, etc. Most if not all of these are unavoidable. Sales tax alone adds nearly 10% anywhere you shop. I'm actually agreeing with you here: in some ways we have the wool pulled over eyes. We pay a ton in taxes and receive little social benefits because most people just don't know to demand them.
kruipen 10y ago
Better comparison is tax burden/spending as % of GDP: Tax % Gov. spending % United States 25.1 41.6 Sweden 44.5 51.2 https://en.wikipedia.org/wiki/Government_spending https://en.wikipedia.org/wiki/Government_spending
Urbanxassassin 10y ago
Well that's why we look at effective tax. Which is significantly lower.

emj 10y ago

I'm guessing you hit the top tax faster in Sweden, the people I know with an degree will get above 50% fast, just anecdotal evidence though.

refurb 10y ago

Marginal tax rates mean nothing unless you know what the actual income brackets are. The US's hughest tax brackets kick in at almost $400K. If Sweden's kicks in at $100K, the tax burden is MuCH higher.

brotherjerky 10y ago
Looks like top tax bracket in Sweden is $90k -- at $90k, CA marginal is 42%. So a delta of 14% -- still probably worth it, especially at lower incomes where student loans and health care a higher percentage of earnings.
- cmdrfred 10y ago
  The question for me is if our government doesn't provide any of those services why aren't we paying half that number?
  - brotherjerky 10y ago
    Well, you can look at the numbers here: http://www.cbpp.org/sites/default/files/styles/report_371px/public/atoms/files/3-4-16bud-policybasics_2.png?itok=fqita01H http://www.cbpp.org/sites/default/files/styles/report_371px/... Medicare, Medicaid, etc: 25% Social Security: 24% Military: 16% Safety Net Programs: 10% Federal / Veteran Benefits: 8% Looks like some people get services, just not everyone. At the state level, California: http://www.usgovernmentspending.com/California_state_spending_pie_chart http://www.usgovernmentspending.com/California_state_spendin... Health Care 35% Pensions 18% Education 16% Welfare 9% Protection (?) 7% The US does not seem to get a great return on healthcare spending.
    - iainmerrick 10y ago
      Also, US military spending is truly enormous. There is a big return on that (obviously opinions differ as to whether it's worthwhile...) (Edit for fact-checking: hmm, while the USA's military budget is by far the largest in the world, as a fraction of GDP it's not that extreme. Wikipedia says it's 3.3% of GDP, high compared to the world average of 2.3%, but way behind the likes of Israel, Russia and Saudi Arabia.)
    - cmdrfred 10y ago
      So then the question is are our elected officials corrupt or incompetent?
      - Symmetry 10y ago
        The biggest problem is that the electorate doesn't trust the elected officials in this matter. To bring down healthcare costs you need to be able to reject treatments that are much more expensive but only provide slight benefits. Organizations like the NHS in Britain are very good at this. But whenever someone gestures in that direction in the US you have people up in arms about "death panels" and the idea is quickly dropped. I don't know though. Maybe if politicians just came out and said "This proposal will produce 10 extra deaths per year but we'll be saving $50bn so we think it's worth it" then people would be willing to embrace that.
        cmdrfred 10y ago
        I don't even think you are talking about more net deaths. Every percentage point you raise taxes or healthcare costs pushes a group of people underwater. A certain percent of people who have bankruptcies will commit suicide/beat their wife to death/yell at their children until they develop mental issues etc. Economic policies have consciences that are diffcult to measure.
  - eli_gottlieb 10y ago
    Because you have the vital job as an American taxpayer of subsidizing oil companies, drug companies, military contractors, investment banks, and land speculators.

temp246810 10y ago

There is so much more to taxes too then just income tax. Sales tax, vehicle tax, fuel tax, etc. Most if not all of these are unavoidable. Sales tax alone adds nearly 10% anywhere you shop. I'm actually agreeing with you here: in some ways we have the wool pulled over eyes. We pay a ton in taxes and receive little social benefits because most people just don't know to demand them.

kruipen 10y ago

Better comparison is tax burden/spending as % of GDP: Tax % Gov. spending % United States 25.1 41.6 Sweden 44.5 51.2 https://en.wikipedia.org/wiki/Government_spending https://en.wikipedia.org/wiki/Government_spending

Urbanxassassin 10y ago

Well that's why we look at effective tax. Which is significantly lower.