3 ms·
When people who are fans of the "Scandinavian model" in the U.S. try and hype it up, this is what they seldom understand (or at least publicly recommend). In S
by alehul 8y ago
When people who are fans of the "Scandinavian model" in the U.S. try and hype it up, this is what they seldom understand (or at least publicly recommend).
In Sweden, until you hit ~$65,000 in yearly income, all of the taxes you pay on income (which is a relatively high rate) goes to your local government. Only after that point, your extra income goes to the federal government. [1]
This model cuts out the immensely large federal government which serves as a middle-man for distributing the income you contribute to your local community, while simultaneously sucking out so much of it— either siphoning it to federal causes, or people's salaries chipping away at it as it's sloshed around.
It's much more efficient when the majority of your income taxes support your local community directly. In the U.S. right now, these localities rely on property taxes, which is _much_ smaller of an income stream. People supporting the Scandinavian model should understand that this is necessary, and that's even more true when your country is larger.
[1] https://www.nordisketax.net/main.asp?url=files/sve/eng/i07.asp https://www.nordisketax.net/main.asp?url=files/sve/eng/i07.a... Heard this point from Swedish family and having trouble finding it online, but the typical municipality income tax is 29-34% and corresponds to equivalent tax deductions from federal taxation, which seems to effectively have the same (or near same) result.
- cjrp 8y agoIs there some kind of balancing which prevents the nice areas (i.e. containing more affluent people) from becoming really nice, and the poorer areas becoming worse?
- alehul 8y agoGood question! I wondered the same. There isn’t explicitly, and I know that’s part of what the federal top-down model tries to prevent, but is it really working? The United States’ affluent areas are night-and-day to the poor ones. If we think about the per-capita income in poorer areas of the States, and what can be taxed off of that, it seems like it’s still enough for that community to function. The current U.S. model seems to result in everyone getting a much smaller pie, even if the government manages to change the portions of who gets what.