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How bad is it? I pay more than 50 percent of my income in various taxes in the United States. Before anyone asks, federal income, Medicare, Medicaid, social se

How bad is it? I pay more than 50 percent of my income in various taxes in the United States. Before anyone asks, federal income, Medicare, Medicaid, social security, state income, state sales tax, local property tax, and lesser- luxury and gas tax.

dpau 7y ago
That seems steep? What about health insurance? I worked for a few years in The Netherlands and paid a little over 50% of my salary in taxes, however in return I had access to amazing government resources and some of the best health care in the world. At 50% I'd expect the US to provide at least some healthcare :(
- Sir_Vival 7y ago
  That does provide healthcare - Medicare and Medicaid, which I believe covers about half of the US population. One reason some are opposed to going to a government paid system is the fact that we spend so much on that where if the costs were simply doubled it'd be a rediculous expense.
  - dpau 7y ago
    Well, by looking at more advanced countries that do have universal healthcare at fairly reasonable tax rates, there are models for how it can be done without doubling our taxes..
  - throwaway_law 7y ago
    >One reason some are opposed to going to a government paid system is the fact that we spend so much on that where if the costs were simply doubled it'd be a rediculous expense. Or maybe people would realize a County like Germany is able to cover the entire County (2x as many people as Medicare) while spending half the Medicare budget. Then, questions of waste and fraud might pop up, which no one involved wants to happen.
    - y4mi 7y ago
      Germany's healthcare is very efficient, but definitely very conservative in the treatments. Issues are often just ignored until they go away. It usually works fine though, so it's not necessarily bad.
      - arcticbull 7y ago
        Excess care and excess testing are not always correlated with better health outcomes. Doing more isn't always better.
      - throwaway_law 7y ago
        >Issues are often just ignored until they go away. In someways thats part of the reason our Medicare program is so expensive. In the US we essentially go an entire lifetime without regular/preventative care, then when patients become eligible for Medicare, they have a lifetime worth of chronic illness that is treated on the tax payers dime. 7 out of 10 Medicare have at least 1 chronic condition, and chronic conditions are notoriously expensive to treat. Whereas nearly 100% of chronic conditions could be avoided if the patient had regular/preventative care (for example identifying prediabetics or patients with high blood pressure, or heart disease) while they were young enough to make the lifestyle changes to avoid these conditions altogether. Our system is essentially designed to ensure patients are both chronically ill and expensive before they are eligible for coverage.
  - arcticbull 7y ago
    > One reason some are opposed to going to a government paid system is the fact that we spend so much on that where if the costs were simply doubled it'd be a rediculous expense. They're wrong because Medicare and Medicaid are more efficient and control costs better than the private sector. Costs are already more than doubled once you add in the private sector. Even if taxes were doubled y'all would still end up paying less on the net because your employers are already paying for healthcare, which is a private tax.
- blaser-waffle 7y ago
  > At 50% I'd expect the US to provide at least some healthcare :( So would many Americans. But those defense contractors need their cut. And non-US projects tend to be more expensive than other countries as well.
  - njarboe 7y ago
    Surprising to most, the US governments spend a higher percent of GDP on healthcare than most European countries[1]. Then we also have high private sector spending on healthcare. Its pretty crazy. [1] https://www.healthsystemtracker.org/chart-collection/health-spending-u-s-compare-countries https://www.healthsystemtracker.org/chart-collection/health-...
    - davidivadavid 7y ago
      Those comparisons aren't very enlightening if you don't compare the quality of services provided.
      - jamesb93 7y ago
        Does it really matter how much better it is when you can go immediately bankrupt from a simple procedure? I imagine there is immense pressure and loss of wealth by simple virtue that people probably don't maintain good health but go in when it gets bad enough that going bankrupt is worse than dying or being violently ill with no end in sight.
        davidivadavid 7y ago
        You're muddying several issues here. I'm simply stating that the value of a healthcare system in terms of outcomes must be compared to how much it costs. What you're talking about is how the system is financed, which is a different issue. For example, as a French citizen, I would expect that if we're in the top 5 in terms of spending (regardless of whether it's done privately or publicly), we should have a system that's in the top 5 in terms of outcomes. I wasn't in any way trying to suggest the US healthcare system is the "best" or whatever, just pointing out that pure cost comparisons are meaningless.
- soperj 7y ago
  Medicare and Medicaid cover about 1/3 of the us population.
  - cameldrv 7y ago
    They are about half of the spending though. Old people use a lot of health care.
paublyrne 7y ago
For comparison sake, sales tax, gas tax and so on would not be considered under tax by someone living in Europe in that sort of calculation. People would mean income and social tax.
- darawk 7y ago
  That's not a Europe/US thing. Most Americans wouldn't count them either. However, they're both wrong to not count them. They absolutely count.
  - arcticbull 7y ago
    They're fundamentally different, one is a progressive tax designed to support a civil society (income tax) and the other is a regressive usage-based tax designed to dis-incentivize behavior such as smoking, drinking and using gas/private automobiles. One's a benefit driver, the other is designed a penalty or market force.
    - darawk 7y ago
      Ok, but they are both taxes, yes? And they both diminish your effective income. So, when calculating the relative tax burden between countries, they both count.
      - arcticbull 7y ago
        They do both diminish your income, but only if you insist on doing things society doesn't want you to do. Driving is optional, smoking is optional, drinking is optional. You can opt out by changing your lifestyle to be healthier and more sustainable -- in which case you'd not pay that tax in either country. Income tax isn't optional.
        darawk 7y ago
        Sure, but you either are or are not willing to make those changes, and you presumably already have made them to the extent that you're willing. Whatever burden ends up being imposed based on your consumption habits simply is what it is.
amerkhalid 7y ago
You have to make more than $2M a year to pay 50% or more of your income in taxes in California: https://smartasset.com/taxes/income-taxes#nJbFzkKePY https://smartasset.com/taxes/income-taxes#nJbFzkKePY Of course, above calculator doesn't include sales, property, luxury or gas taxes.
- bpodgursky 7y ago
  10% sales tax, and a couple percent property tax on a $500k-1mm home (in CA) moves that threshold a lot, lot lower.
- arcticbull 7y ago
  When most people say "50% of their income" they tend to mean on a marginal basis. Now that Donny capped state, local and property tax deductions at $10,000 per year (meaning you get double-taxed on the rest) and reduced the mortgage interest tax deduction cap from $1M to $750K, that number got much closer. At $300,000 you're paying 48.65% marginal. That doesn't include, in SF, a 9% sales tax, a 1.188% property tax (that of course even renters pay as owners use rental income to offset that cost), and to your point, luxury and gas taxes.
0xfaded 7y ago
Denmark has a law that you can't be taxed more than 56% of your income. Then there is 25% VAT (sales tax), so if you're in the top bracket and spend your entire income you can theoretically be taxed 67%. Cars have a special 160% tax (you pay 260% of base price). And there's no capital gains loopholes. There's no payroll tax per se, but the employer contributes to a maternity/paternity fund in addition to some other small items. It's very true that the Danes receive good free health care and have good universities, but the longer I live here the more I see that a huge amount of tax revenue is squandered on administration. I'm pro taxation, but it's hard to be exposed to such waste.
buboard 7y ago
well for comparison, in beautiful Greece, your total income tax & social security ranges from 50% - 75%. In return you get lots of sun, bureaucracy and sweat. https://s.kathimerini.gr/resources/2017-12/s3a_3112foroi-eisfores-thumb-large.jpg https://s.kathimerini.gr/resources/2017-12/s3a_3112foroi-eis...
totalrobe 7y ago
Plus EU taxes often cover healthcare so there's another huge chunk of change gone for US residents when comparing.
- adventured 7y ago
  That's incorrect. Essentially all decent paying jobs in the US take care of most or all of the healthcare cost you're referring to. That is especially true for eg software developers who earn six figures at the median. To balance a proper comparison if you're going to include the EU taxes re healthcare, you would have to inflate US wages even higher to account for the benefit that employees receive (money that otherwise would be available for labor competition in the form of salary), which is often a large sum of money given the cost of US healthcare. US healthcare per capita is typically 100% (double) more expensive than in Western Europe. It's about 130% more expensive versus Britain. It's 200%+ more expensive versus Italy. A software developer earning $125,000 - $150,000 per year is receiving a minimum of an additional 10% equivalent of their salary in the form of healthcare coverage. More likely 15-20% these days. The cost to put a small family on a good health plan will easily run you $20,000+ per year.
  - mtnGoat 7y ago
    you might want to check the stats for the claims in your first paragraph, unless "decent job" in this case is top 5%. Only 49% of Americans have employer sponsored health plans and most of those are not entirely paid for by the employer. and only 91% of Americans are insured.
  - totalrobe 7y ago
    My family healthcare coverage at my "decent paying job" at a software company in the US cost me about $13,000 out of pocket in 2018 including employee premium and medical cost before reaching deductible. I would certainly consider that to be an additional tax when comparing against the EU tax rates that include healthcare.
pergadad 7y ago
If you pay taxes abroad the US will still haunt you to show that you paid - and if it's lower than you would have paid back home claim the difference. Many American expats in Europe that have acquired the right for local nationality give up their nationality for that reason.
- jsweojtj 7y ago
  I doubted that "many" expats give up their US citizenship so I tried to find some numbers. Found some secondary sources like: https://www.forbes.com/sites/robertwood/2018/05/14/fewer-americans-renounce-citizenship-but-taxes-still-drive-them/#2564308b119f https://www.forbes.com/sites/robertwood/2018/05/14/fewer-ame... which states that, worldwide, just over 5,000 Americans renounced citizenship in 2017. There are also about 9 million Americans living abroad and ~1 million living in Europe. So, no, I don't think that even if all 5,000 were in Europe that 0.5% renounced their citizenship would count as "many".
  - whamlastxmas 7y ago
    Additionally, you still owe the US tax for ten years after renouncing
  - johannes1234321 7y ago
    How many of these " ~1 million living in Europe" are with the US Armed Forces? (Be it as service member, spuse, family) Quick research: Kaiserslautern Military Community has ~50k people. https://en.m.wikipedia.org/wiki/Kaiserslautern_Military_Community https://en.m.wikipedia.org/wiki/Kaiserslautern_Military_Comm... Now that's the largest, but by far not only location with US Military presence in Europe.
    - jsweojtj 7y ago
      I'm curious, where are you heading with this counter argument? That perhaps, something like 900k Americans living in Europe are in the US Armed Forces, leaving 100k regular US citizens. So then, if all 5k of the US citizen renouncers worldwide are in Europe, then 5% of the remaining 100k _does_ count as "many"?

dpau 7y ago

That seems steep? What about health insurance? I worked for a few years in The Netherlands and paid a little over 50% of my salary in taxes, however in return I had access to amazing government resources and some of the best health care in the world. At 50% I'd expect the US to provide at least some healthcare :(

Sir_Vival 7y ago
That does provide healthcare - Medicare and Medicaid, which I believe covers about half of the US population. One reason some are opposed to going to a government paid system is the fact that we spend so much on that where if the costs were simply doubled it'd be a rediculous expense.
- dpau 7y ago
  Well, by looking at more advanced countries that do have universal healthcare at fairly reasonable tax rates, there are models for how it can be done without doubling our taxes..
- throwaway_law 7y ago
  >One reason some are opposed to going to a government paid system is the fact that we spend so much on that where if the costs were simply doubled it'd be a rediculous expense. Or maybe people would realize a County like Germany is able to cover the entire County (2x as many people as Medicare) while spending half the Medicare budget. Then, questions of waste and fraud might pop up, which no one involved wants to happen.
  - y4mi 7y ago
    Germany's healthcare is very efficient, but definitely very conservative in the treatments. Issues are often just ignored until they go away. It usually works fine though, so it's not necessarily bad.
    - arcticbull 7y ago
      Excess care and excess testing are not always correlated with better health outcomes. Doing more isn't always better.
    - throwaway_law 7y ago
      >Issues are often just ignored until they go away. In someways thats part of the reason our Medicare program is so expensive. In the US we essentially go an entire lifetime without regular/preventative care, then when patients become eligible for Medicare, they have a lifetime worth of chronic illness that is treated on the tax payers dime. 7 out of 10 Medicare have at least 1 chronic condition, and chronic conditions are notoriously expensive to treat. Whereas nearly 100% of chronic conditions could be avoided if the patient had regular/preventative care (for example identifying prediabetics or patients with high blood pressure, or heart disease) while they were young enough to make the lifestyle changes to avoid these conditions altogether. Our system is essentially designed to ensure patients are both chronically ill and expensive before they are eligible for coverage.
- arcticbull 7y ago
  > One reason some are opposed to going to a government paid system is the fact that we spend so much on that where if the costs were simply doubled it'd be a rediculous expense. They're wrong because Medicare and Medicaid are more efficient and control costs better than the private sector. Costs are already more than doubled once you add in the private sector. Even if taxes were doubled y'all would still end up paying less on the net because your employers are already paying for healthcare, which is a private tax.
blaser-waffle 7y ago
> At 50% I'd expect the US to provide at least some healthcare :( So would many Americans. But those defense contractors need their cut. And non-US projects tend to be more expensive than other countries as well.
- njarboe 7y ago
  Surprising to most, the US governments spend a higher percent of GDP on healthcare than most European countries[1]. Then we also have high private sector spending on healthcare. Its pretty crazy. [1] https://www.healthsystemtracker.org/chart-collection/health-spending-u-s-compare-countries https://www.healthsystemtracker.org/chart-collection/health-...
  - davidivadavid 7y ago
    Those comparisons aren't very enlightening if you don't compare the quality of services provided.
    - jamesb93 7y ago
      Does it really matter how much better it is when you can go immediately bankrupt from a simple procedure? I imagine there is immense pressure and loss of wealth by simple virtue that people probably don't maintain good health but go in when it gets bad enough that going bankrupt is worse than dying or being violently ill with no end in sight.
      - davidivadavid 7y ago
        You're muddying several issues here. I'm simply stating that the value of a healthcare system in terms of outcomes must be compared to how much it costs. What you're talking about is how the system is financed, which is a different issue. For example, as a French citizen, I would expect that if we're in the top 5 in terms of spending (regardless of whether it's done privately or publicly), we should have a system that's in the top 5 in terms of outcomes. I wasn't in any way trying to suggest the US healthcare system is the "best" or whatever, just pointing out that pure cost comparisons are meaningless.
soperj 7y ago
Medicare and Medicaid cover about 1/3 of the us population.
- cameldrv 7y ago
  They are about half of the spending though. Old people use a lot of health care.

paublyrne 7y ago

For comparison sake, sales tax, gas tax and so on would not be considered under tax by someone living in Europe in that sort of calculation. People would mean income and social tax.

darawk 7y ago
That's not a Europe/US thing. Most Americans wouldn't count them either. However, they're both wrong to not count them. They absolutely count.
- arcticbull 7y ago
  They're fundamentally different, one is a progressive tax designed to support a civil society (income tax) and the other is a regressive usage-based tax designed to dis-incentivize behavior such as smoking, drinking and using gas/private automobiles. One's a benefit driver, the other is designed a penalty or market force.
  - darawk 7y ago
    Ok, but they are both taxes, yes? And they both diminish your effective income. So, when calculating the relative tax burden between countries, they both count.
    - arcticbull 7y ago
      They do both diminish your income, but only if you insist on doing things society doesn't want you to do. Driving is optional, smoking is optional, drinking is optional. You can opt out by changing your lifestyle to be healthier and more sustainable -- in which case you'd not pay that tax in either country. Income tax isn't optional.
      - darawk 7y ago
        Sure, but you either are or are not willing to make those changes, and you presumably already have made them to the extent that you're willing. Whatever burden ends up being imposed based on your consumption habits simply is what it is.

amerkhalid 7y ago

You have to make more than $2M a year to pay 50% or more of your income in taxes in California: https://smartasset.com/taxes/income-taxes#nJbFzkKePY https://smartasset.com/taxes/income-taxes#nJbFzkKePY Of course, above calculator doesn't include sales, property, luxury or gas taxes.

bpodgursky 7y ago
10% sales tax, and a couple percent property tax on a $500k-1mm home (in CA) moves that threshold a lot, lot lower.
arcticbull 7y ago
When most people say "50% of their income" they tend to mean on a marginal basis. Now that Donny capped state, local and property tax deductions at $10,000 per year (meaning you get double-taxed on the rest) and reduced the mortgage interest tax deduction cap from $1M to $750K, that number got much closer. At $300,000 you're paying 48.65% marginal. That doesn't include, in SF, a 9% sales tax, a 1.188% property tax (that of course even renters pay as owners use rental income to offset that cost), and to your point, luxury and gas taxes.

0xfaded 7y ago

Denmark has a law that you can't be taxed more than 56% of your income. Then there is 25% VAT (sales tax), so if you're in the top bracket and spend your entire income you can theoretically be taxed 67%. Cars have a special 160% tax (you pay 260% of base price). And there's no capital gains loopholes. There's no payroll tax per se, but the employer contributes to a maternity/paternity fund in addition to some other small items. It's very true that the Danes receive good free health care and have good universities, but the longer I live here the more I see that a huge amount of tax revenue is squandered on administration. I'm pro taxation, but it's hard to be exposed to such waste.

buboard 7y ago

well for comparison, in beautiful Greece, your total income tax & social security ranges from 50% - 75%. In return you get lots of sun, bureaucracy and sweat. https://s.kathimerini.gr/resources/2017-12/s3a_3112foroi-eisfores-thumb-large.jpg https://s.kathimerini.gr/resources/2017-12/s3a_3112foroi-eis...

totalrobe 7y ago

Plus EU taxes often cover healthcare so there's another huge chunk of change gone for US residents when comparing.

adventured 7y ago
That's incorrect. Essentially all decent paying jobs in the US take care of most or all of the healthcare cost you're referring to. That is especially true for eg software developers who earn six figures at the median. To balance a proper comparison if you're going to include the EU taxes re healthcare, you would have to inflate US wages even higher to account for the benefit that employees receive (money that otherwise would be available for labor competition in the form of salary), which is often a large sum of money given the cost of US healthcare. US healthcare per capita is typically 100% (double) more expensive than in Western Europe. It's about 130% more expensive versus Britain. It's 200%+ more expensive versus Italy. A software developer earning $125,000 - $150,000 per year is receiving a minimum of an additional 10% equivalent of their salary in the form of healthcare coverage. More likely 15-20% these days. The cost to put a small family on a good health plan will easily run you $20,000+ per year.
- mtnGoat 7y ago
  you might want to check the stats for the claims in your first paragraph, unless "decent job" in this case is top 5%. Only 49% of Americans have employer sponsored health plans and most of those are not entirely paid for by the employer. and only 91% of Americans are insured.
- totalrobe 7y ago
  My family healthcare coverage at my "decent paying job" at a software company in the US cost me about $13,000 out of pocket in 2018 including employee premium and medical cost before reaching deductible. I would certainly consider that to be an additional tax when comparing against the EU tax rates that include healthcare.

pergadad 7y ago

If you pay taxes abroad the US will still haunt you to show that you paid - and if it's lower than you would have paid back home claim the difference. Many American expats in Europe that have acquired the right for local nationality give up their nationality for that reason.

jsweojtj 7y ago
I doubted that "many" expats give up their US citizenship so I tried to find some numbers. Found some secondary sources like: https://www.forbes.com/sites/robertwood/2018/05/14/fewer-americans-renounce-citizenship-but-taxes-still-drive-them/#2564308b119f https://www.forbes.com/sites/robertwood/2018/05/14/fewer-ame... which states that, worldwide, just over 5,000 Americans renounced citizenship in 2017. There are also about 9 million Americans living abroad and ~1 million living in Europe. So, no, I don't think that even if all 5,000 were in Europe that 0.5% renounced their citizenship would count as "many".
- whamlastxmas 7y ago
  Additionally, you still owe the US tax for ten years after renouncing
- johannes1234321 7y ago
  How many of these " ~1 million living in Europe" are with the US Armed Forces? (Be it as service member, spuse, family) Quick research: Kaiserslautern Military Community has ~50k people. https://en.m.wikipedia.org/wiki/Kaiserslautern_Military_Community https://en.m.wikipedia.org/wiki/Kaiserslautern_Military_Comm... Now that's the largest, but by far not only location with US Military presence in Europe.
  - jsweojtj 7y ago
    I'm curious, where are you heading with this counter argument? That perhaps, something like 900k Americans living in Europe are in the US Armed Forces, leaving 100k regular US citizens. So then, if all 5k of the US citizen renouncers worldwide are in Europe, then 5% of the remaining 100k _does_ count as "many"?