4 ms·
I'm not the guy you're responding to, but I thought I had a reasonable strategy to simply calculate it. I can't do it for America, because I'm not sufficiently
by impossiblefork 5y ago
I'm not the guy you're responding to, but I thought I had a reasonable strategy to simply calculate it. I can't do it for America, because I'm not sufficiently familiar with what data you have available and am instead going to do the analysis for Sweden.
In Sweden the labour share of GDP is 55%, however taxes on wages are 60% of the total government income, and a large remaining fraction of the taxes on work income. Another 30% is from VAT. Let's assume arbitrarily that half the VAT is paid by workers and not with income from capital.
Under this assumption, workers receive 55% of GDP in compensation before taxes, but pay 70% of all taxes.
If taxes on income were the same for workers as for capital then workers would pay 55% instead of 70%, so taxes would be 18% lower than they are now.