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I'm not sure how much I trust these tax rates. My understanding was that government spending is roughly 33% of GDP here in the US. This was true when I was in u
by milesvp 8y ago
I'm not sure how much I trust these tax rates. My understanding was that government spending is roughly 33% of GDP here in the US. This was true when I was in undergrad, and it looks to be roughly correct today. https://www.usgovernmentspending.com/percent_gdp https://www.usgovernmentspending.com/percent_gdp (not sure how much I trust this site, but it corroborates what I learned in undergrad with only a few minutes of googling). This means that the tax rate must be close to 33%. Else you'd have amazing deficits balooning quite quickly.
Maybe it's ignoring corporate taxes? or ignoring other things on our W-2, like L&I and social security/medicare? It 's also probably ignoring local taxes, a 10% sales tax is hard to ignore.
I once calculated my effective marginal tax rate at 45%, and it stopped me from pursuing a higher paying job, since my take home didn't change enough to be worth the higher stress and the money I'd have to spend to combat said stress.
- sykhic 8y agoWe do have massive deficits.
- greedo 8y agoFederal marginal tax rates for 2018 are capped at 37% if you make $500K ($600K for a couple). If you're hitting that plus 8% for state, then I don't have too much sympathy. And that's a marginal rate, not an effective rate (which it seems you're conflating). If you earned $500k, and were single/no deps, and just took the standard $12K deduction, your Federal tax would be 29% ($145K). I can't imagine someone with that income not having more deductions or IRA/401 contributions that would minimize the tax burden, but I suppose there's always someone out there completely clueless.