8 ms·
If half your paycheck is going to taxes you must have a bunch of $$$, I personally make around 300k/year and I feel like I'm not paying that much taxes. I could
by ccktlmazeltov 6y ago
If half your paycheck is going to taxes you must have a bunch of $$$, I personally make around 300k/year and I feel like I'm not paying that much taxes. I could be paying much more and still live pretty comfortable, it's pretty outrageous.
- ciupicri 6y agoYou can donate money to the US Government if you feel that you're not giving it enough. See https://www.fiscal.treasury.gov/public/gifts-to-government.html https://www.fiscal.treasury.gov/public/gifts-to-government.h...
- nloladze 6y agoyeah we already have that, it's called "lobbying"
- ccktlmazeltov 6y agoI'd be happy if everyone gave more, I don't believe in donation. I believe the government should be funded to work for the public. Refusing to fund the government is why we're in this.
- malwarebytess 6y agoAh yes, the obligate vacant comment about donating to the Federal Government when there's talk of taxes being too low on the wealthy. Get a new line. The problems in this country, including the mess that is the tax system, cannot be solved by snarky comments like "donate your money if you think taxes are too low." They require a longitudinal and deep response.
- rayiner 6y agoThe problems in this country also cannot be solved by empty rhetoric about “taxes being too low on the wealthy.” Taxes on the wealthy in the US aren’t dramatically lower than in Europe. The top tax bracket in Germany is 45%, versus 37% + state. So if you live in any of the 9 states with a top state bracket of 8% or higher, including New York and California, the top income tax bracket is actually lower in Germany. Capital gains taxes in Germany are also similar accounting for state capital gains taxes. So how does Germany pay for its expansive welfare state? It has a 42% bracket that kicks in at 57,000 euro. In California, the marginal dollar income tax at that level is just 26% (federal plus state). It also has a 20% VAT. In both Germany and the US, the vast majority of income is earned by the bottom 99%. In the US, we don’t tax those people enough. (Or we tax them what they want to be taxed. I can’t help but notice that while half the country wants European-style social services, nobody is proposing European-style taxes on people making under six figures, or a VAT. Even Sanders promised not to raise taxes on people making below $250,000. The math just doesn’t work. Americans—the bottom 99% that makes 80% of all income—have chosen to be taxed less than Europe in return for less social services than Europe.)
- newacct583 6y agoYou're quoting nominal rates and not effective taxation. The very wealthy don't pay their "marginal dollar" in "income tax" at a 37% federal bracket (plus state), they pay it in capital gains tax at 20%. If they pay it at all, given that in fact much income at these levels is sheltered from tax entirely via international tricks. There's plenty of analysis out there showing how the very wealthy in the US pay less effective tax than middle class families. That's not "empty rhetoric". It's a genuine problem and something we should be trying to solve.
- rayiner 6y agoCapital gains is 20% federal plus state (13% in California). Germany’s capital gains rate is 30.5%, lower than California and New York. Regardless, there is just not enough capital gains income for that to matter. For example, Biden’s plan to tax capital gains as ordinary income for taxpayers making over $1 million per year is expected to bring in less than $50 billion a year in revenues. Eliminating the capital gains preference entirely would raise only $130 billion annually. As to the “very wealthy”—Tim Cook’s tax rate on his $135 million bonus a few years ago was 52%. The people you’re talking about aren’t even ordinary wealthy people: CEOs, movie stars, and the like. What you’re talking about the Warren Buffets of the world that make money through investments. But there’s just not very many of those people. The IMF estimates the global cost of individual tax avoidance at $200 billion per year: https://www.imf.org/external/pubs/ft/fandd/2019/09/tackling-global-tax-havens-shaxon.htm https://www.imf.org/external/pubs/ft/fandd/2019/09/tackling-.... Say half that is attributable to the US. That’s about the same as the cost of the deductions for mortgage interest and local property taxes. Federal, state, and local governments tax more than $5 trillion annually. One party is proposing new spending amounting to several trillion more annually. In the face of those numbers, talking about $50 billion or $100 billion issues with respect to the taxation of the very wealthy is indeed empty rhetoric. You hear a lot of talk about billionaires this and billionaires that. The total income of all billionaires in the US is $130 billion, or about 1% of all income. It just doesn’t matter very much what the tax rate is on people who comprise only 1% of the tax base. Spending 90% of your time talking about tax issues that could fund at most 10% of your proposed new spending is empty rhetoric. Meanwhile, German levels of taxation on the middle class, and a German-style VAT would raise trillions annually. Guess why nobody talks about that.
- cortesoft 6y agoThis doesn't make sense. If I decide to give more money to the government, nothing will change because my money is a drop in the bucket. If everyone gives more money, we can actually make things better. I am willing to pay more taxes if it actually helps, which is why I will only give more when we make everyone give more.
- gfxgirl 6y agoThere's an assumption there that more money to government = make things better but there are plenty of examples where the government makes things worse. Some people believe that giving less = actually make things better because it will limit the bad things a government can do.
- 411111111111111 6y agoSome people believe that the earth is flat as well.
- bryanrasmussen 6y agoIs there a venn diagram of Randians and flat-earthers somewhere? on edit: changed libertarians to Randians.
- bryanrasmussen 6y agodamn, I've evidently offended some flat-earthers out there.
- mettamage 6y ago411111111111111: substantiate what you're trying to say. For a reminder, read the community guidelines. The way I read this is as an attack on the parent. You might not agree with the parent, but that doesn't mean you write a comment that reads like an unsubstantiated attack. The reason it reads as an attack to me is because HN's core persona seems to be a science-minded person (perhaps debatable, it's how I see it). Likening someone in any way shape or form to flat earth believer ridicules their argument, without you adding anything of substance as it goes directly against the core persona of a person on HN. Implicitly, it seems that you're calling the parent stupid. I don't know if that was your intention or if you thought about it differently, but this is one of the reasons why one should substantiate their comments. This seems to be less the case when someone is being nice, but when someone is being controversial, then substantiating your comment is the only way in which you can guide a reader's interpretation (I'm saying this from quite a bit of experience). FWIW I flagged your comment. I'd recommend you to read the HN community guidelines [1]. In particular you violated (IMO): Be kind. Don't be snarky. Have curious conversation; don't cross-examine. Comments should get more thoughtful and substantive, not less, as a topic gets more divisive. When disagreeing, please reply to the argument instead of calling names. "That is idiotic; 1 + 1 is 2, not 3" can be shortened to "1 + 1 is 2, not 3." Please don't post shallow dismissals, especially of other people's work. A good critical comment teaches us something. [1] https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
- ashtonkem 6y agoI generally assume that 40% of my paycheck will go to taxes and savings. That’s not quite correct, but it’s a good first order of magnitude estimate.
- ccktlmazeltov 6y agoand savings?
- ashtonkem 6y agoThat includes anything that’s pre-paycheck, which would include 401k and HSA in my case, but would exclude post-tax savings (I was imprecise in my original comment). Again, this is a rough rule that’ll typically be personally conservative, not a precise calculation.
- dan-robertson 6y agoFew countries even in Europe will let your effective income tax rate reach 50% but this may be an effect of tax system structure more than anything else. Eg in the U.K. the max marginal income tax rate is 45% but that doesn’t count payroll taxes (employer or employee), which are called “national insurance”, or student loan “repayments” (9% of income above a threshold, though not super relevant to people in the top band), or oddities of the tax system like a somewhat hidden 60% marginal rate or a discontinuity with the married couples allowance or withdrawal of certain otherwise-universal benefits for children. It is similar in other European countries (at least as far as I can tell from a cursory search showing that sources can’t really agree on what the highest marginal rate is). I would be interested in seeing a chart of gross to net income and effective tax rate in different countries but this is hard (eg do you count employer payroll taxes? Do you count removal of state’s benefits that might not be used anyway? How do you deal with countries that have more complicated systems with eg deductions or allowances based on personal situations?) All that said, I think the post you’re replying to could just mean “approximately half,” ands I think 40% would fit that description.
- masonic 6y agoin the U.K. the max marginal income tax rate is 45% That's a big change from years ago, when it was 95% (hence "it's one for you, nineteen for me" in the Beatles' "Taxman").
- cesaref 6y agoThat was 50 years ago. The top rate was 75% for income over £20k (something like £250k in todays money). Now how many people were in this category, or how they managed to avoid appearing to have that much income I don't know. I think income tax was even higher during WW2, but that's pretty much a special case.
- GordonS 6y agoAlso in the UK. When you take into account the council tax and national insurance (extra income tax by another name), the effective tax rate for is easily above 50% for most "high earners". And that is without considering fuel duty, VED, VAT etc.
- NikolaNovak 6y ago* (Edit: Leaving original for traceability, but note my math was incorrect as per subsequent comment:) * Depends on where and depends how you're counting it. In Ontario, Canada, and I'm not an accountant so very approximately based on GoC website: At ~~$150k CAD you are at 29% federal + 12 % Provincial tax. On anything you buy though you get another 13% VAT So now we are at 54%, plus CPP and EI. Plus any other taxes - property, land transfer, etc - overall it's well above 50% for what would be ~100k USD
- drpgq 6y agoAs an Ontarian it is frustrating how the marginal tax rate has risen over 50% over the last decade, but ignorant people think things are the same as in the US. Of course capital gains on primary residences is taxed at 0% so it isn't really surprising that real estate and its financialization is Ontario's main industry.
- NikolaNovak 6y agoI'm actually with the OP - taxes as such don't offend me; I'm more concerned to get value out of them / their efficiency and purpose, rather than what they are in absolute terms. But wanted to point out that 50% is not unheard of and doesn't have to be in "millionaire" category of income.
- amscanne 6y agoI don’t think it’s just that it has risen over 50%, the increases over the last ~6 years are quite rapid. Consider BC [1]: Top income tax bracket in BC in 2013: 43.7% Top income tax bracket in BC in 2014 and 2015: 45.8% Top income tax bracket in BC in 2016 and 2017: 47.7% Top income tax bracket in BC in 2018 and 2019: 49.8% Top income tax bracket in BC starting in 2020: 53.5%. I believe that there have been similar effects in ON from increases & new brackets, on both the federal and provincial level. [1] https://twitter.com/cperciva/status/1229900065726054400?s=21 https://twitter.com/cperciva/status/1229900065726054400?s=21
- deleted 6y ago[deleted]
- rayiner 6y agoEconomists calculate taxes using the “tax wedge”—i.e. what you pay in taxes versus what you cost your employer. According to: https://smartasset.com/taxes/california-tax-calculator#WP4ghMESEg https://smartasset.com/taxes/california-tax-calculator#WP4gh..., take home on $300,000 in California is $185,000. But including employer side payroll taxes but excluding benefits, you actually cost your employer $313,000. So your tax wedge is about 41%. Then add in the sales and property taxes you pay directly or indirectly, and you’re probably close to 45%. At $500,000, your tax wedge is 45% before sales and property taxes, so you’re probably over 50% all in.
- sandworm101 6y agoIf we are making international comparisons, I would add the cost of health insurance in california as a "tax". That's the only way to reasonably compare western countries. I had a friend try to adopt a baby from china many years ago (1990s). He was rejected. The Chinese thought he didn't earn enough to safely raise a kid. They were using a means test designed for US applicants. My friend lobbied to explain all the things he gets in Canada for free, health care being the big ticket item. The Chinese authorities relented and he was allowed to adopt.
- perl4ever 6y agoI don't follow how this could be possible. I'd think most people in the US either would be getting health insurance from the government (Medicare, Medicaid), from an "Obamacare" exchange and subsidized, or from an employer where they don't pay cash. So where would the discrepancy in accounting between that and Canada come from? It seems unlikely that the Chinese government would assume that even Americans buy health insurance retail.
- sandworm101 6y ago>> It seems unlikely that the Chinese government would assume that even Americans buy health insurance retail. They aren't assuming anything. They know that healthcare in the US is hit-or-miss, that it is normally for people to move between having and not having healthcare throughout a lifetime. >> The new report highlights that 5.5% of children under the age of 19 were uninsured, largely because of a decline in public coverage. https://www.census.gov/library/stories/2019/09/uninsured-rate-for-children-in-2018.html https://www.census.gov/library/stories/2019/09/uninsured-rat... 1 in 20 American kids are uninsured, not counting the undocumented who don't answer the census. That's ridiculous today but it was even worse in the 90s. That's why the Chinese didn't want to give kids to non-wealthy Americans. Uninsured children are almost unheard of in Canada. Only some illegal immigrant children, but even there they have systems in place.
- bryanrasmussen 6y agoWell, if half your payments is going to taxes it might very mean you have a bunch of €€€ instead of $$$, that bunch being calculated relative to median income of your country - what I'm saying is that while I don't know what country you're from tax rates are also calculated differently in different countries, in Denmark where I live it isn't impossible for a software developer to hit the top tax rate.