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I'm seriously impressed: See the national debt of Norway (34.33% of GDP) - this is insanely low for developed countries. For comparison: US - 107.40%, Germany

I'm seriously impressed: See the national debt of Norway (34.33% of GDP) - this is insanely low for developed countries. For comparison: US - 107.40%, Germany - 61.51% https://www.nationaldebtclocks.org/debtclock/norway https://www.nationaldebtclocks.org/debtclock/norway https://www.nationaldebtclocks.org/debtclock/unitedstates https://www.nationaldebtclocks.org/debtclock/unitedstates https://www.nationaldebtclocks.org/debtclock/germany https://www.nationaldebtclocks.org/debtclock/germany - - - Another important measurement is the Gini coefficient [1] which shows us if the wealth is distributed equally (G = 0% means everyone gets the same; G = 100% means one person has everything). Norway: G = 27.5% US: G = 48% (this means 1% owns half the wealth) Germany: G = 28.9% after taxes (G = 49% before taxes). This shows how big the impact of taxes is for a fair distribution of wealth. Unfortunately, it's known that high-net-worth individuals have options to extract wealth without paying taxes. But I think they don't necessarily do themselves a favor because they simultaneously destroy the society they enjoy and depend on. https://tradingeconomics.com/norway/gini-index-wb-data.html https://tradingeconomics.com/norway/gini-index-wb-data.html https://www.statista.com/statistics/219643/gini-coefficient-for-us-individuals-families-and-households/ https://www.statista.com/statistics/219643/gini-coefficient-... http://www.oecd.org/social/income-distribution-database.htm http://www.oecd.org/social/income-distribution-database.htm https://www.gut-leben-in-deutschland.de/static/LB/indicators/income/gini-coefficient-income/ https://www.gut-leben-in-deutschland.de/static/LB/indicators... [1]: https://en.wikipedia.org/wiki/Gini_coefficient https://en.wikipedia.org/wiki/Gini_coefficient

marvin 8y ago
Did your sources distinguish Norway's Gini coefficient before and after taxes? My impression is that marginal taxation here is massive, since we have a sales tax of 25% (consumption tax, effectively), high taxes on luxury goods (cars especially), wealth tax of 0.85% of net worth every year and capital gains tax of 30% with no exemption for long-term holdings. The marginal tax rate on income is 46% IIRC, but your employer has already paid 14% of your salary in employment tax before you're paid. On top of this is property taxes, fees to local government, annual car tax etc. If you make a complete assessment of the taxes a high-earning, high-spending person pays, it can easily surpass 70% of all income.
- mockingbirdy 8y ago
  See [1]. Norway has a Gini index of G = 41% before taxes and G = 25% after taxes (another source said G = 27.5% after taxes). In Germany we also get heavily taxed although I don't think it's that drastic: 19% consumption tax, 25% + 5.5% on capital gains, a marginal tax rate that linearly increases up to 42% for high-earners [2]. [1]: https://en.wikipedia.org/wiki/List_of_countries_by_income_equality#Gini_coefficient,_after_taxes_and_transfers https://en.wikipedia.org/wiki/List_of_countries_by_income_eq... [2]: https://en.wikipedia.org/wiki/Taxation_in_Germany https://en.wikipedia.org/wiki/Taxation_in_Germany
- Applejinx 8y ago
  "wealth tax of 0.85% of net worth every year" Interesting. That's very much in line with what my experiments showed: just on a computer model of incredibly primitive 'economics', you can use an incredibly tiny wealth tax to redistributive effect. I think you can even ditch a lot of sales, income tax etc. if you're prepared to do a wealth tax. It seems to be very effective but this is the first I've heard of it actually being done anywhere.
  - marvin 8y ago
    See also https://news.ycombinator.com/item?id=14828357 https://news.ycombinator.com/item?id=14828357 for a summary of the most important Norwegian taxes, which I posted elsewhere. Summarized as of last year.
  - tonfa 8y ago
    It's not that uncommon. Many Swiss cantons have a progressive wealth tax. France used to have one but it's now limited to real estate holdings.
  - sobani 8y ago
    The Netherlands also have it, sort of. It started of as a 30% capital gains tax, but at some point the government was like: "Math is hard, let's pretend 4% return on capital." and we effectively ended up with a 1.2% wealth tax. In the last few years they realized that wealthier people have a higher return on capital and the effective wealth tax is more progressive with an effective wealth tax of ~1.6% at the highest bracket.
NizaAfrica 8y ago
It's because Norway is one of the most heavily taxed countries in the world with a total tax burden of roughly 45% of GDP– almost 4x Hong Kong and nearly twice the US. VAT here is a whopping 25%. Personal income tax rates border 55%. Corporate profits tax ranges from 28% to as high as 78% Moreover revenues from Equinor also help.
- marvin 8y ago
  Interesting to see the measure of total tax burden vs. GDP. Never heard that variant before, during discussions where it becomes obvious it's difficult to compare the tax systems of different countries. Apparently, perhaps not surprisingly, the Nordic countries top this list: https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio https://en.wikipedia.org/wiki/List_of_countries_by_tax_reven...

marvin 8y ago

Did your sources distinguish Norway's Gini coefficient before and after taxes? My impression is that marginal taxation here is massive, since we have a sales tax of 25% (consumption tax, effectively), high taxes on luxury goods (cars especially), wealth tax of 0.85% of net worth every year and capital gains tax of 30% with no exemption for long-term holdings. The marginal tax rate on income is 46% IIRC, but your employer has already paid 14% of your salary in employment tax before you're paid. On top of this is property taxes, fees to local government, annual car tax etc. If you make a complete assessment of the taxes a high-earning, high-spending person pays, it can easily surpass 70% of all income.

mockingbirdy 8y ago
See [1]. Norway has a Gini index of G = 41% before taxes and G = 25% after taxes (another source said G = 27.5% after taxes). In Germany we also get heavily taxed although I don't think it's that drastic: 19% consumption tax, 25% + 5.5% on capital gains, a marginal tax rate that linearly increases up to 42% for high-earners [2]. [1]: https://en.wikipedia.org/wiki/List_of_countries_by_income_equality#Gini_coefficient,_after_taxes_and_transfers https://en.wikipedia.org/wiki/List_of_countries_by_income_eq... [2]: https://en.wikipedia.org/wiki/Taxation_in_Germany https://en.wikipedia.org/wiki/Taxation_in_Germany
Applejinx 8y ago
"wealth tax of 0.85% of net worth every year" Interesting. That's very much in line with what my experiments showed: just on a computer model of incredibly primitive 'economics', you can use an incredibly tiny wealth tax to redistributive effect. I think you can even ditch a lot of sales, income tax etc. if you're prepared to do a wealth tax. It seems to be very effective but this is the first I've heard of it actually being done anywhere.
- marvin 8y ago
  See also https://news.ycombinator.com/item?id=14828357 https://news.ycombinator.com/item?id=14828357 for a summary of the most important Norwegian taxes, which I posted elsewhere. Summarized as of last year.
- tonfa 8y ago
  It's not that uncommon. Many Swiss cantons have a progressive wealth tax. France used to have one but it's now limited to real estate holdings.
- sobani 8y ago
  The Netherlands also have it, sort of. It started of as a 30% capital gains tax, but at some point the government was like: "Math is hard, let's pretend 4% return on capital." and we effectively ended up with a 1.2% wealth tax. In the last few years they realized that wealthier people have a higher return on capital and the effective wealth tax is more progressive with an effective wealth tax of ~1.6% at the highest bracket.

NizaAfrica 8y ago

It's because Norway is one of the most heavily taxed countries in the world with a total tax burden of roughly 45% of GDP– almost 4x Hong Kong and nearly twice the US. VAT here is a whopping 25%. Personal income tax rates border 55%. Corporate profits tax ranges from 28% to as high as 78% Moreover revenues from Equinor also help.

marvin 8y ago
Interesting to see the measure of total tax burden vs. GDP. Never heard that variant before, during discussions where it becomes obvious it's difficult to compare the tax systems of different countries. Apparently, perhaps not surprisingly, the Nordic countries top this list: https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio https://en.wikipedia.org/wiki/List_of_countries_by_tax_reven...