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This is bad for Europe because our salaries (before tax) have already been lower than US salaries. Additionally we pay much more taxes than you guys on salaries
by de6u99er 4y ago
This is bad for Europe because our salaries (before tax) have already been lower than US salaries. Additionally we pay much more taxes than you guys on salaries (up to 50%) and on VAT (~20%).
Means at the moment until salaries get inflation adjusted that we pay a premium price for everything.
- deleted 4y ago[deleted]
- pastor_bob 4y agoCanadians do just fine with a weak dollar, low pay, and high taxes
- peanuty1 4y agoYet 80% of Waterloo computer science grads move to the US after graduating to enjoy a higher quality of life.
- focom 4y agoYep can confirm. If I had a Canadian passport, I would have no reason to stick to freezing Canada.
- aabhay 4y agoYup. Canadians don't go bankrupt because of medical bills (the #1 leading cause of bankruptcies in the US)
- threads2 4y agoYeah but then wE DoN'T hAvE a ChOiCe iN dOcToRs.
- rmatt2000 4y ago> #1 leading cause of bankruptcies in the US This isn't true. A certain well-known politician made this claim, but it turns out she counted everyone who had medical debt when they declared personal bankruptcy as a "bankruptcy caused by medical debt." If someone gambled away their home and incidentally had an unpaid doctor's bill, it's a stretch to call that a medical bankruptcy. https://www.theatlantic.com/business/archive/2009/06/why-elizabeth-warrens-new-bankruptcy-study-is-so-bad/18835/ https://www.theatlantic.com/business/archive/2009/06/why-eli...
- peanuty1 4y agoWow, Elizabeth Warren loses more of my respect every day.
- threads2 4y ago"medical-debt-related" bankruptcy then. To your point, wonder if it's higher than any other ___-related bankruptcies (anyone have data on that?)
- TMWNN 4y agoTo expand on your comment, only 4% of US bankruptcies are because of medical bills <https://www.washingtonpost.com/blogs/post-partisan/wp/2018/03/26/the-truth-about-medical-bankruptcies/ https://www.washingtonpost.com/blogs/post-partisan/wp/2018/0...>. A tipoff that [insert large percentage here] of bankruptcies aren't actually because of medical costs is that only 6% of bankruptcies by those without health insurance are because of that cause. The biggest cause of bankruptcies is lack of income, which health insurance doesn't affect.
- jleyank 4y agoWeak but not that weak as it’s roughly tracking the US dollar at 0.78 +/-. Benefits of its raw material/petrodollar nature. And others have pointed out a more aggressive move against inflation than say europe.
- _njyk 4y agoOnce the salaries get inflation adjusted (20%+ of inflation in my country), then the production costs are going to increase, which is going to increase the risk for the prices to spiral up again.
- Ma8ee 4y agoMany Europeans don’t know how much taxes Americans actually pay. It’s not that little, but often paid differently with high property taxes and sales taxes instead of VAT. And most of us (Europeans) don’t have to pay €1000 or so in health insurance for ourself and our family. We might make a bit less money, but most of us have at least 5 weeks of paid vacation (I’ve got almost 7).
- thehappypm 4y agoYep, health care costs for a family can run $10k/year for Americans (out of pocket maximum) and so basically any kind of major illness or baby delivery will cost that much.
- jakear 4y agoHow often do you expect most families encounter major illnesses and/or babies? I’ve literally never used my health insurance. I expect the vast majority of people are in the same boat.
- mercutio2 4y agoThis sounds like the fallacy of youth. I never used medical care in my 20s. In my 30s, my wife and I needed a bit. In my 40s, slightly more. On average Americans use a lot of health care.
- jakear 4y agoAverage of “never”, “a bit”, and “slightly more” is “a bit”, where do you get “a lot” from?
- spiderice 4y agoThat varies widely by your insurance. And given that tech companies use insurance as a way to attract more employees, software employees often pay way less than that. I'm about to have a child and I will pay $0 for it. My wife's company pays everything. Even if we were using my companies insurance instead of hers, we wouldn't pay anywhere near $10k.
- asciimov 4y agoI’d happily pay more US taxes if it was used to fund healthcare, infrastructure, and had better human (worker) rights.
- peanuty1 4y agoSpoiler alert: we (US) already collect enough taxes to adequately fund all of those things.
- asciimov 4y agoLord I know... I think about that sometimes, then I wonder if we get the same great deal on our military spending that we do on our healthcare.
- peter303 4y agoA lot goes to fund a military that gets almost as much as the worlds other militaries combined. And the 2023 budget is being held up because some thinkthe annual increase is too small.
- hackeraccount 4y agoI haven't looked at it in awhile but I think the military is around 20% of the federal budget. The big items are Medicare/Medicaid/Social Security. Maybe interest on the debt. 20% (assuming that's what it is) is still no small amount but I'm personally doubtful there would be some sort of sea change in what's possible if it were cut in half or even eliminated.
- rank0 4y agoAre you serious? Go look up the federal budget. The majority of our spending is for social services. We’re $30T in debt. We can’t even afford what we’ve got now.
- DrBazza 4y agoCareful what you wish for. We (in the UK) fund the NHS significantly to the point that it's now a political football - freezing funding to it and wanting it to be better run is political suicide, but wanting to cancel a piece of national infrastructure (HS2, our second high speed railway) that would demonstrable add to the country's GDP, and cost a tiny amount in comparison, is fine.
- nivenkos 4y agoYeah, like as a senior engineer I get $85k, that leads to a take home of about $4500 per month. Mortgage and debt payments are ~$2500 to start with. And now that buys less and less. We can't afford to be playing world police or pretend to be the world's refuge.
- cactus2093 4y agoA lot of people working in tech in California pay above 40% effective income tax rate with a top marginal tax rate of like 48%. So Europe income tax rates are not as much higher as you might think. The tax brackets in the US tend to be much progressive though, so for people earning lower salaries their taxes in the US are much lower.
- samjmck 4y agoTo put this into perspective a little, Belgian income tax is 40% after 23000 euros (which is now 23k dollar) and 50% after 43000 euros. So the issue here is the middle and even lower class being hit with incredibly high taxes.
- mercutio2 4y agoA California family of two (no kids) making $400k, with no deductions, not even contributions to their retirement, will pay an effective 32% tax rate on all income. At $600k, it's 37% effective tax rate (again, with zero deductions). You have to make $817k, with zero deductions, before you'll pay 40% effective tax rate in California. None of this includes sales tax, which is 10-11% depending on municipality in California. Europe's lowest VAT is 17% in Luxembourg. It is not my impression that "a lot of people" in tech are making that much, even by the extreme standards of the Bay Area these days.
- cactus2093 4y agoIf you count social security and medicaid taxes the $400k couple is paying 36% and the 600k couple is paying 40%. So yeah it's not the majority of people in the Bay Area paying 40% but if both spouses are working at big tech companies and they're more than a few years into their career then they will likely be somewhere in this range and paying close to 40%
- mercutio2 4y agoI don't know how I managed to use a calculator that didn't include FICA, but for a single earner that barely changes the analysis. A single earner (again, with the unusual state of no deductions) has to make $690k to reach 40%. For a dual-high-income earner households I concede 40% effective isn't going to be uncommon.
- stefco_ 4y agoIf you want to talk about premiums, the US housing market is out of control right now; just having a roof over your head in any metropolitan area means paying through the nose. It’s rough all over :(
- hiram112 4y agoThis really isn't how it works. You might pay a premium price for specialty goods and foods imported from the US, but, based on a quick Google search, there doesn't appear to be many consumer items - our top 5 exports are aircraft, machinery, pharma, mineral oils, and medical instruments. In developed countries, the majority of the costs for goods and services (and taxes) come from labor, which means they're not affected by currency fluctuations too much. Not a good time to vacation to the US, nor is it a good deal for Americans working in the EU and paid in Euros who need to pay past bills back in the US
- option 4y agoyou can get to 50% (up to 39% federal and 12% state) in CA before sales and real estate tax if you are in high enough tax braket.
- vineyardmike 4y agoMost Americans think that taxes are high elsewhere and low in America, and I guess Europeans think that? Maybe it’s true but I think American taxes are higher than people seem to believe though. A tech worker in Silicon Valley will easily hit >40% income tax (30+ federal, 10 Cali). Sales tax is up to 10%. Many places have affordable property tax due to American laws on home ownership. California may be a state with laws closer to Europe than many other American states (eg texas). Massachusetts/New England generally have “better” laws too (eg MA has stronger healthcare protections than most states). Not sure what ordinary Europeans actual pay, but an internet search says German taxes go up to 40s, which seems pretty inline with Cali. Obviously a tech worker in SV will be top few % for American salaries, but you need to be a well paid urban worker in America to be able to get healthcare and an income that affords college for children and good public transit and other things Europeans get from their governments.
- acchow 4y ago> an internet search says German taxes go up to 40s, which seems pretty inline with Cali. Using https://www.arbeitnow.com/tools/salary-calculator/germany https://www.arbeitnow.com/tools/salary-calculator/germany and https://smartasset.com/taxes/income-taxes#9jiRJIN31w https://smartasset.com/taxes/income-taxes#9jiRJIN31w In Berlin, 200k nets you 113k after taxes In California, 200k nets 132k after taxes That is 43.5% vs 33% But there are differences in sales taxes/VAT, property taxes (and deductions for such), mortgage interest deduction, etc. A $1M mortgage loan at 3% could reduce your taxable income by 30k, saving you almost 10k in taxes per year in the US.
- hef19898 4y agoGerman net includes unemployment, social security and health care, among other things (did the stat include church tax or not?), not sure about the California thing. That being said, one million in mortgage buys you one hell of an house in Berlin! And mortgage payments can be tax deductible to an extent as well.
- acchow 4y ago
- fartcannon 4y agoOver here we call this premium the Canada Tax. Prepare for it never to go away no matter what the Euro does.
- xwdv 4y agoI think many Europeans are about to learn why “low salary but low cost of living” isn’t better than simply getting paid a straight high salary.
- MaysonL 4y agoEverything except health care.
- irrational 4y agoI pay nearly 50% income taxes between federal and state. And we have sales tax and other taxes. I’m not sure you really do pay more in taxes.