5 ms·

Germany has a lot of drawbacks to be the next silicon valley: * the most difficult tax system in the world. even freelancers have to use accountant services, b

Germany has a lot of drawbacks to be the next silicon valley: * the most difficult tax system in the world. even freelancers have to use accountant services, because most people will not be able to pay taxes properly without it. * high taxes - 42% income tax + Solidaritätszuschlag 5.5% = 47.5%; for corporations it's ~30%. * A LOT of buerocracy. I can't even send an email to tax authorities in my area, because they only accept paper letters but nothing else. * highly qualified foreigners have to learn German and it's quite difficult language. * the market in Germany is much smaller comparing to USA. If you want to target EU, then you have to support a lot of different languages, date/time formats, regulations and laws etc. * recently the EU introduced a lot of additional regulations for internet companies (GDPR, new copyright directives that require checking uploaded files, etc...). * weather is not that appealing as in the valley. * the difference in salaries between regular developers and rockstars is very low. So there is zero motivation to become one. * low salaries for software engineers. The most of senior software developers will earn 50.000 - 60.000 EURO anually and after paying taxes it's only ~2.600 EURO per month (3.000 USD) * poor internet connection in a lot of places / poor connection speed - almost any country is better in this regard

cabraca 8y ago
> low salaries for software engineers. The most of senior software developers will earn 50.000 - 60.000 EURO anually and after paying taxes it's only ~2.600 EURO per month (3.000 USD) i have 5 years experience and already earn that much. our most senior staff gets their low 6 figures + bonus. what most dont see is, that additionally to those numbers, your employer pays their share of your healthcare and social security. thats probably another 15% or more. you get at least 20 vacation days. most of the time its around 30. they cant just fire you because you got sick. and in case you get fired, there is a social security net to catch you. yeah, from an US view it might look like a bad place and i would appreciate lower taxes. on the other hand: my mom is fighting cancer sind 1999. in the US i would already be bankrupt or my mom would be dead. or both
southerndrift 8y ago
For startups, taxes for corporations don't matter. You only pay taxes on profits. If you are living off venture capital, then you have none. If you are self-funding with organic growth then you have to make sure that you spend all your profits on growth which you should do anyway. Once you have matured, you can still restructure the company like Apple or Google and turn into an Irish or Estonian company. That's the advantage of the EU. High income taxes are a problem. But that's not a problem for founders since their profits are hidden in the increased value of the company. It's a topic for the employees. They have elected parties that redistribute income. It's their choice how they want to spend their income. If you compare wages between Germany and USA then those taxes haven't made German labor more expensive than US labor. People don't have to earn as much as possible right away because they don't face nothing should they ever become handicapped.
- kvz 8y ago
  > If you are self-funding with organic growth then you have to make sure that you spend all your profits on growth which you should do anyway In my case I have a mortgage and kids. To make sure we get by, with the high profit tax, there needs to be enough profit left, ergo, I’m not investing as much in the company to leave enough for the government and my family to consume. I’m sure there are enough people who can get by with very little, and what you say makes sense. Just doesn’t apply to all, and that means on the country scale: smaller pool of people that are willing, and less money going back into growing companies.
  - southerndrift 8y ago
    That's why you find constellations where a wife owns a company and the husband is the manager or vice versa. The manager gets a regular salary onto which he pays regular income taxes. That way, the income doesn't touch the profit tax. It should be the same if your company has various shareholders.
jlangenauer 8y ago
> low salaries for software engineers. The most of senior software developers will earn 50.000 - 60.000 EURO anually and after paying taxes it's only ~2.600 EURO per month (3.000 USD) Nonsense. Here in Berlin, €60k would only be competitive for an engineer with maybe 2-3 years experience. Good senior people can (and should) get €85k - €90k. If you're in Berlin, and want to be pointed in the direction of companies who pay that, hit me up. VPEng / CTO / Director-level roles are now €100K minimum in Berlin, and often significantly above.
- fatterypt 8y ago
  This ^. I see a lot of people are tricked by their companies to get them to come to Berlin. Then the companies get them believing that a 60k salary is generous for someone with loads of experience. Once you get here, you realize that a lot of companies pay much more than that and you've been taken advantage from.
raverbashing 8y ago
> the most difficult tax system in the world. I love how hyperbolic statements like this get bought and sold like truth. It's not even close to being the most difficult tax system in the world. Source: https://data.worldbank.org/indicator/IC.TAX.DURS?year_high_desc=false https://data.worldbank.org/indicator/IC.TAX.DURS?year_high_d... > highly qualified foreigners have to learn German For startups or tech positions? No, they don't. Also, learning German at a conversational level is not impossible. (But it seems a lot of people in Berlin coast by without even knowing basic German)
- zenovision 8y ago
  Your link just proves how horrible German tax system is: * A german needs 2x more time for taxes than a UK citizen * needs 3x more time than a Norway citizen * needs 4x more time than a Swiss citizen * 20x more time than a UAE citizen
  - raverbashing 8y ago
    "Horrible" United States: 175h Germany: 218h Governments are not very easy dealing, but to call it "horrible" when some countries require 10x the time is unfair.
- deleted 8y ago
  [deleted]
- st1ck 8y ago
  The list doesn't show in Firefox :(
rad_gruchalski 8y ago
Few comments on this, I live and work in Germany as Freiberufler for last couple of years or so. > * the most difficult tax system in the world. even freelancers have to use accountant services, because most people will not be able to pay taxes properly without it. Nothing strange about it. When I was self-emoloyed in the UK, I also had to use services of an accountant. > * high taxes - 42% income tax + Solidaritätszuschlag 5.5% = 47.5%; for corporations it's ~30%. Taxes are high but, for example, Belgium has higher taxes. In the UK I was also hitting 38%. Corporate tax in the UK was back then 20% with 10% tax on dividends, Germany is expensive but not the most expensive. > * A LOT of buerocracy. I can't even send an email to tax authorities in my area, because they only accept paper letters but nothing else. Where do you live. No problem with Finanzamt in NRW and RLP communicating over email. Germans do almost everything on paper but things can snd are done over phone and email. > * highly qualified foreigners have to learn German and it's quite difficult language. No, they don‘t. It depends who your clients are. I live in NRW and barely speak German. Not proud of it, learning. Just an observation. For sure it‘s easier with the language knowledge. > * the market in Germany is much smaller comparing to USA. If you want to target EU, then you have to support a lot of different languages, date/time formats, regulations and laws etc. I am not sure what you mean by that. I just invoice people in different countries. Nothing to do with dates, languages, formats. > * recently the EU introduced a lot of additional regulations for internet companies (GDPR, new copyright directives that require checking uploaded files, etc...). Personal preference. I prefer this over another facebook or google. > * weather is not that appealing as in the valley. > * the difference in salaries between regular developers and rockstars is very low. So there is zero motivation to become one. Fun fact, a graduate in Atlanta gets ~90k/year. Zero experience, barely left university. > * low salaries for software engineers. The most of senior software developers will earn 50.000 - 60.000 EURO anually and after paying taxes it's only ~2.600 EURO per month (3.000 USD) This number seems to be common everywhere in the EU. Different currencies but overall the same value. > * poor internet connection in a lot of places / poor connection speed - almost any country is better in this regard Oh yes. This is so common in Germany. When I read how easy it is to get fibre in India, I cringe.
- southerndrift 8y ago
  Cringe more: https://www.heise.de/newsticker/meldung/Missing-Link-Der-Kampf-um-die-Glasfaser-oder-Der-verpasste-Breitbandausbau-in-Deutschland-3952581.html https://www.heise.de/newsticker/meldung/Missing-Link-Der-Kam... During the late 80ies, Germany was on track to have 1G fibre connections everywhere by the end of the century.

cabraca 8y ago

> low salaries for software engineers. The most of senior software developers will earn 50.000 - 60.000 EURO anually and after paying taxes it's only ~2.600 EURO per month (3.000 USD) i have 5 years experience and already earn that much. our most senior staff gets their low 6 figures + bonus. what most dont see is, that additionally to those numbers, your employer pays their share of your healthcare and social security. thats probably another 15% or more. you get at least 20 vacation days. most of the time its around 30. they cant just fire you because you got sick. and in case you get fired, there is a social security net to catch you. yeah, from an US view it might look like a bad place and i would appreciate lower taxes. on the other hand: my mom is fighting cancer sind 1999. in the US i would already be bankrupt or my mom would be dead. or both

southerndrift 8y ago

For startups, taxes for corporations don't matter. You only pay taxes on profits. If you are living off venture capital, then you have none. If you are self-funding with organic growth then you have to make sure that you spend all your profits on growth which you should do anyway. Once you have matured, you can still restructure the company like Apple or Google and turn into an Irish or Estonian company. That's the advantage of the EU. High income taxes are a problem. But that's not a problem for founders since their profits are hidden in the increased value of the company. It's a topic for the employees. They have elected parties that redistribute income. It's their choice how they want to spend their income. If you compare wages between Germany and USA then those taxes haven't made German labor more expensive than US labor. People don't have to earn as much as possible right away because they don't face nothing should they ever become handicapped.

kvz 8y ago
> If you are self-funding with organic growth then you have to make sure that you spend all your profits on growth which you should do anyway In my case I have a mortgage and kids. To make sure we get by, with the high profit tax, there needs to be enough profit left, ergo, I’m not investing as much in the company to leave enough for the government and my family to consume. I’m sure there are enough people who can get by with very little, and what you say makes sense. Just doesn’t apply to all, and that means on the country scale: smaller pool of people that are willing, and less money going back into growing companies.
- southerndrift 8y ago
  That's why you find constellations where a wife owns a company and the husband is the manager or vice versa. The manager gets a regular salary onto which he pays regular income taxes. That way, the income doesn't touch the profit tax. It should be the same if your company has various shareholders.

jlangenauer 8y ago

> low salaries for software engineers. The most of senior software developers will earn 50.000 - 60.000 EURO anually and after paying taxes it's only ~2.600 EURO per month (3.000 USD) Nonsense. Here in Berlin, €60k would only be competitive for an engineer with maybe 2-3 years experience. Good senior people can (and should) get €85k - €90k. If you're in Berlin, and want to be pointed in the direction of companies who pay that, hit me up. VPEng / CTO / Director-level roles are now €100K minimum in Berlin, and often significantly above.

fatterypt 8y ago
This ^. I see a lot of people are tricked by their companies to get them to come to Berlin. Then the companies get them believing that a 60k salary is generous for someone with loads of experience. Once you get here, you realize that a lot of companies pay much more than that and you've been taken advantage from.

raverbashing 8y ago

> the most difficult tax system in the world. I love how hyperbolic statements like this get bought and sold like truth. It's not even close to being the most difficult tax system in the world. Source: https://data.worldbank.org/indicator/IC.TAX.DURS?year_high_desc=false https://data.worldbank.org/indicator/IC.TAX.DURS?year_high_d... > highly qualified foreigners have to learn German For startups or tech positions? No, they don't. Also, learning German at a conversational level is not impossible. (But it seems a lot of people in Berlin coast by without even knowing basic German)

zenovision 8y ago
Your link just proves how horrible German tax system is: * A german needs 2x more time for taxes than a UK citizen * needs 3x more time than a Norway citizen * needs 4x more time than a Swiss citizen * 20x more time than a UAE citizen
- raverbashing 8y ago
  "Horrible" United States: 175h Germany: 218h Governments are not very easy dealing, but to call it "horrible" when some countries require 10x the time is unfair.
deleted 8y ago
[deleted]
st1ck 8y ago
The list doesn't show in Firefox :(

rad_gruchalski 8y ago

Few comments on this, I live and work in Germany as Freiberufler for last couple of years or so. > * the most difficult tax system in the world. even freelancers have to use accountant services, because most people will not be able to pay taxes properly without it. Nothing strange about it. When I was self-emoloyed in the UK, I also had to use services of an accountant. > * high taxes - 42% income tax + Solidaritätszuschlag 5.5% = 47.5%; for corporations it's ~30%. Taxes are high but, for example, Belgium has higher taxes. In the UK I was also hitting 38%. Corporate tax in the UK was back then 20% with 10% tax on dividends, Germany is expensive but not the most expensive. > * A LOT of buerocracy. I can't even send an email to tax authorities in my area, because they only accept paper letters but nothing else. Where do you live. No problem with Finanzamt in NRW and RLP communicating over email. Germans do almost everything on paper but things can snd are done over phone and email. > * highly qualified foreigners have to learn German and it's quite difficult language. No, they don‘t. It depends who your clients are. I live in NRW and barely speak German. Not proud of it, learning. Just an observation. For sure it‘s easier with the language knowledge. > * the market in Germany is much smaller comparing to USA. If you want to target EU, then you have to support a lot of different languages, date/time formats, regulations and laws etc. I am not sure what you mean by that. I just invoice people in different countries. Nothing to do with dates, languages, formats. > * recently the EU introduced a lot of additional regulations for internet companies (GDPR, new copyright directives that require checking uploaded files, etc...). Personal preference. I prefer this over another facebook or google. > * weather is not that appealing as in the valley. > * the difference in salaries between regular developers and rockstars is very low. So there is zero motivation to become one. Fun fact, a graduate in Atlanta gets ~90k/year. Zero experience, barely left university. > * low salaries for software engineers. The most of senior software developers will earn 50.000 - 60.000 EURO anually and after paying taxes it's only ~2.600 EURO per month (3.000 USD) This number seems to be common everywhere in the EU. Different currencies but overall the same value. > * poor internet connection in a lot of places / poor connection speed - almost any country is better in this regard Oh yes. This is so common in Germany. When I read how easy it is to get fibre in India, I cringe.

southerndrift 8y ago
Cringe more: https://www.heise.de/newsticker/meldung/Missing-Link-Der-Kampf-um-die-Glasfaser-oder-Der-verpasste-Breitbandausbau-in-Deutschland-3952581.html https://www.heise.de/newsticker/meldung/Missing-Link-Der-Kam... During the late 80ies, Germany was on track to have 1G fibre connections everywhere by the end of the century.