4 ms·

40% income tax is abhorrent.

by valuearb 10y ago

shaydoc 10y ago
It's 40% on earnings above around 45K, below that it's 20%
- mbell 10y ago
  That is still extremely high depending on where you are coming from. The US also uses a marginal tax system and the highest bracket is 39.6% and starts at ~$425k (varies based on how you are filing). ~$38-90k bracket is 25%.
  - ninjaroar 10y ago
    You have to add in state tax if you comparing against the US. (Not all states have an income tax, but California does have one)
    - valuearb 10y ago
      And 15% federal payroll taxes
  - noir_lord 10y ago
    You don't pay any tax on the first 11500 either. So on 44999 You'd be paying 20% of (44999 - 11500) so 6700 on 44999 (effective rate been 14.8%).
    - shaydoc 10y ago
      exactly... its not that bad! includes free healthcare! and in northern ireland, free prescriptions!
deleted 10y ago
[deleted]
tonyedgecombe 10y ago
Personally I'm quite comfortable with it even though I'm in that bracket.
CiaranMcNulty 10y ago
Someone earning his salary is taking home £36k or so, paying effectively 28%
corford 10y ago
It's banded in the UK. Your first £11.5K of income is tax free, the balance up to £45K is taxed at 20%, anything over £45K and under £150K is taxed at 40% and anything beyond £150K is taxed at 45%. In return you get free education up to (but not including) university age and universally free health care. There's also national insurance at 12% of earnings over £680/month (money from this tax is used to fund state pensions and unemployment benefits).
throwaway_tax 10y ago
My effective tax rate in London with a salary slightly higher than the OP was 38%. My effective tax rate in San Francisco with a salary 4x what I was making in London is 36%. Rent is comparable, with bigger appartments in San Francisco, buying is comparable. Quality food is more expensive in SF, other goods (electronics/clothing/etc.) is more expensive everywhere in Europe. Quality of life depends on wether you like the outdoors (SF), want a car (SF), or prefer city activities and/or dislike driving (London). London is also great if you like to travel, specially throughout Europe. The West Coast is particularly far from almost everywhere and there's a distinct lack of cheap airlines. From London you can have a $20 weekend getaway to, say, Prague. Admitedly, you do travel like cattle, but it is cheap. In the US, besides what you're taxed, you must add all other fees that get added to almost anything you'll want to do, from healthcare to going out (the famous tipping), going through bank transfers (they're free throughout Europe, regulated markets, they charge you whatever the bank wants to in the US, only reliable way to transfer money here is to send cheques). Overall, myself and my wife like it here, have made some great friends and don't really want to go (wouldn't cry for too long if we had to). We can save a ton of money because we have two incomes and weren't looking for the "2.5 kids house with garage for two cars and white picket fence", so we got a deal on both appartment ("small" for american standards, twice as big as our flat in London for roughly the same ammonut before the pound plummeted) and our car ("tiny" for american standards and manual transmission, it cost less than the anual insurance). Every place is great to visit, every single place has things you'll complain about when you move there. Honestly, the thing that worries me is political, from the madman in power to the old lady that screamed at me and a bunch of other techies that "Trump won now so y'all will have to go back, I'm getting my city back." I didn't see the fallout from Brexit, but from my friends over there it is not as bad as here, but objectively bad regardless...
dmoo 10y ago
This is pretty common in Europe. For example income tax and social insurance contributions in Ireland would be greater than 50% of marginal income at this level. This money is used to fund services and fund the national debt.

40% income tax is abhorrent.

shaydoc 10y ago

It's 40% on earnings above around 45K, below that it's 20%

mbell 10y ago
That is still extremely high depending on where you are coming from. The US also uses a marginal tax system and the highest bracket is 39.6% and starts at ~$425k (varies based on how you are filing). ~$38-90k bracket is 25%.
- ninjaroar 10y ago
  You have to add in state tax if you comparing against the US. (Not all states have an income tax, but California does have one)
  - valuearb 10y ago
    And 15% federal payroll taxes
- noir_lord 10y ago
  You don't pay any tax on the first 11500 either. So on 44999 You'd be paying 20% of (44999 - 11500) so 6700 on 44999 (effective rate been 14.8%).
  - shaydoc 10y ago
    exactly... its not that bad! includes free healthcare! and in northern ireland, free prescriptions!

deleted 10y ago

[deleted]

tonyedgecombe 10y ago

Personally I'm quite comfortable with it even though I'm in that bracket.

CiaranMcNulty 10y ago

Someone earning his salary is taking home £36k or so, paying effectively 28%

corford 10y ago

It's banded in the UK. Your first £11.5K of income is tax free, the balance up to £45K is taxed at 20%, anything over £45K and under £150K is taxed at 40% and anything beyond £150K is taxed at 45%. In return you get free education up to (but not including) university age and universally free health care. There's also national insurance at 12% of earnings over £680/month (money from this tax is used to fund state pensions and unemployment benefits).

throwaway_tax 10y ago

My effective tax rate in London with a salary slightly higher than the OP was 38%. My effective tax rate in San Francisco with a salary 4x what I was making in London is 36%. Rent is comparable, with bigger appartments in San Francisco, buying is comparable. Quality food is more expensive in SF, other goods (electronics/clothing/etc.) is more expensive everywhere in Europe. Quality of life depends on wether you like the outdoors (SF), want a car (SF), or prefer city activities and/or dislike driving (London). London is also great if you like to travel, specially throughout Europe. The West Coast is particularly far from almost everywhere and there's a distinct lack of cheap airlines. From London you can have a $20 weekend getaway to, say, Prague. Admitedly, you do travel like cattle, but it is cheap. In the US, besides what you're taxed, you must add all other fees that get added to almost anything you'll want to do, from healthcare to going out (the famous tipping), going through bank transfers (they're free throughout Europe, regulated markets, they charge you whatever the bank wants to in the US, only reliable way to transfer money here is to send cheques). Overall, myself and my wife like it here, have made some great friends and don't really want to go (wouldn't cry for too long if we had to). We can save a ton of money because we have two incomes and weren't looking for the "2.5 kids house with garage for two cars and white picket fence", so we got a deal on both appartment ("small" for american standards, twice as big as our flat in London for roughly the same ammonut before the pound plummeted) and our car ("tiny" for american standards and manual transmission, it cost less than the anual insurance). Every place is great to visit, every single place has things you'll complain about when you move there. Honestly, the thing that worries me is political, from the madman in power to the old lady that screamed at me and a bunch of other techies that "Trump won now so y'all will have to go back, I'm getting my city back." I didn't see the fallout from Brexit, but from my friends over there it is not as bad as here, but objectively bad regardless...

dmoo 10y ago

This is pretty common in Europe. For example income tax and social insurance contributions in Ireland would be greater than 50% of marginal income at this level. This money is used to fund services and fund the national debt.