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Issue in denmark is that high pay gets heavily taxed. So 102k is what 50k at best? Factor in vat and its less.

by yrgulation 4y ago

coffee_beqn 4y ago
True but you also get more “free” services for your tax payments - especially if you have kids.
- yrgulation 4y ago
  Like anywhere in europe, and if you want quality or quick service you go private.
mrweasel 4y ago
Why would that push salaries down? Should they be even higher in that case?
- IaacForHire 4y ago
  A few years ago a Danish friend of mine said she'd hit a point where it wasn't worth taking a raise because of the progressive taxation system, and so instead she would negotiate for more benefits.
  - yrgulation 4y ago
    I left denmark many moons ago for the same reason. Tipping point was when i wanted to buy a car. When i was the amount in tax i basically packed and left. Somehow people think that denmark is expensive because somehow products are better quality, but they arent really. It’s just high taxes. At hospitals you have to wait in long queues for anything serious and universities are meh. Paid for my public uk degree a very tiny amount and was rather happy with it.
    - IaacForHire 4y ago
      I feel you on this. I live in the 3rd world (Turkiye) and have been itching to buy a motorcycle lately. The $26k BMW 1250RT I want costs $35k here, and another $20k in taxes.
    - Melchori 4y ago
      So as soon as you were paying back into your country you decided enough is enough and moved to a country with much higher social inequality? Okay good for you but a weird brag. One of my main reason not to go to USA is exactly that. I don't want to earn lots of money while my country people have to go to a Sporthall to get their teeth fixed once a year because you need to be special to go to a dentist.
      - goodpoint 4y ago
        > enough is enough and moved to a country with much higher social inequality? "screw you I got mine"
  - mrweasel 4y ago
    That's not how our tax system works. There are different intervals, so at some point you need to pay a higher percentage, but only of the amount above that point. This year it's 552.500DKK, anything you make ABOVE that, is taxed an additional 15%. So a raise will never leave you with less money. The amount is also adjusted yearly, so next year it normally higher, meaning that you are effectively taxed less. It is true that if you're only getting 35 - 40% of that raise, because the rest is just taxes, it might be of greater value to you to get more vacation time. Benefits are a little tricky, because they are taxed as well. I believe you could do extra pension, because that's taxed when it's paid out.
    - yrgulation 4y ago
      Thats how the tax system works in any progressive tax system. I believe india has such a systen as well. Danish brackets are higher and so is every other tax.
      - mrweasel 4y ago
        So your boss wants to give you a $1000 raise, but you don't want it, because you'll only get the $400 and the rest is just tax? At no point will taking the $400 impact what you're already making or how it's taxed. Even the Danish government isn't stupid enough to implement a system where your existing income is reduced, because you get a raise. Again I see the point if you're offered or able to get some kind of benefits or vacation time instead. That may easily be of greater value to you. That's just not often an option. Edit: If it helps: A progressive tax is what the US have. India may as well, that I don't know.
    - IaacForHire 4y ago
      Well now I have a better idea of how much my friend makes (she's an exec at a big company). I just lost my sympathy for her.
silvestrov 4y ago
So very wrong. $102k/year = DKK 759288/year = DKK 63274/month. Typing 63274 into https://hvormegetefterskat.dk https://hvormegetefterskat.dk (howmuchaftertax) says 40.2% tax rate. The you have to factor in $0 in health costs (gratis hospital and doctor visits), no payments for kids attending university, 32 weeks of paid maternal leave, and 5 weeks of mandatory holiday each year.
- yrgulation 4y ago
  There is no such thing as “free services”. You paid for them through taxes. Also you need to factor in vat and everything else being expensive due to taxes. Dont get me wrong, denmark looks great, but as many “rich” west eu countries the country is rich but the people arent.
  - silvestrov 4y ago
    And you need to factor in that Danish people do not need to pay for health services. $50k after tax in Denmark needs to pay for fewer expenses than $50k after tax in USA. So it is not a valid comparison to just compare income tax and VAT. In this case Denmark ends up not being more expensive for a nice middle class life. It's just that ill-informed people thinks otherwise. Quality of life in Denmark is higher: https://www.usnews.com/news/best-countries/rankings/quality-of-life https://www.usnews.com/news/best-countries/rankings/quality-...
- IaacForHire 4y ago
  > The you have to factor in $0 in health costs (gratis hospital and doctor visits), no payments for kids attending university, 32 weeks of paid maternal leave, and 5 weeks of mandatory holiday each year. This sounds great if you're the type to have a family. Otherwise, seems like you kind of get screwed?
  - mdorazio 4y ago
    Compared to what? In California I was paying a full 35% effective tax rate on top of something like 3000 a year in health insurance/deductibles and still had a sizable homeless camp on my street. Plus if I wanted to go back to school for an advanced degree the cost was a joke. In the US you can definitely bring home more dollars in absolute terms, but I've found if you actually compare total life costs and standards of living you end up at fairly similar % between SV and Europe.

Issue in denmark is that high pay gets heavily taxed. So 102k is what 50k at best? Factor in vat and its less.

coffee_beqn 4y ago

True but you also get more “free” services for your tax payments - especially if you have kids.

yrgulation 4y ago
Like anywhere in europe, and if you want quality or quick service you go private.

mrweasel 4y ago

Why would that push salaries down? Should they be even higher in that case?

IaacForHire 4y ago
A few years ago a Danish friend of mine said she'd hit a point where it wasn't worth taking a raise because of the progressive taxation system, and so instead she would negotiate for more benefits.
- yrgulation 4y ago
  I left denmark many moons ago for the same reason. Tipping point was when i wanted to buy a car. When i was the amount in tax i basically packed and left. Somehow people think that denmark is expensive because somehow products are better quality, but they arent really. It’s just high taxes. At hospitals you have to wait in long queues for anything serious and universities are meh. Paid for my public uk degree a very tiny amount and was rather happy with it.
  - IaacForHire 4y ago
    I feel you on this. I live in the 3rd world (Turkiye) and have been itching to buy a motorcycle lately. The $26k BMW 1250RT I want costs $35k here, and another $20k in taxes.
  - Melchori 4y ago
    So as soon as you were paying back into your country you decided enough is enough and moved to a country with much higher social inequality? Okay good for you but a weird brag. One of my main reason not to go to USA is exactly that. I don't want to earn lots of money while my country people have to go to a Sporthall to get their teeth fixed once a year because you need to be special to go to a dentist.
    - goodpoint 4y ago
      > enough is enough and moved to a country with much higher social inequality? "screw you I got mine"
- mrweasel 4y ago
  That's not how our tax system works. There are different intervals, so at some point you need to pay a higher percentage, but only of the amount above that point. This year it's 552.500DKK, anything you make ABOVE that, is taxed an additional 15%. So a raise will never leave you with less money. The amount is also adjusted yearly, so next year it normally higher, meaning that you are effectively taxed less. It is true that if you're only getting 35 - 40% of that raise, because the rest is just taxes, it might be of greater value to you to get more vacation time. Benefits are a little tricky, because they are taxed as well. I believe you could do extra pension, because that's taxed when it's paid out.
  - yrgulation 4y ago
    Thats how the tax system works in any progressive tax system. I believe india has such a systen as well. Danish brackets are higher and so is every other tax.
    - mrweasel 4y ago
      So your boss wants to give you a $1000 raise, but you don't want it, because you'll only get the $400 and the rest is just tax? At no point will taking the $400 impact what you're already making or how it's taxed. Even the Danish government isn't stupid enough to implement a system where your existing income is reduced, because you get a raise. Again I see the point if you're offered or able to get some kind of benefits or vacation time instead. That may easily be of greater value to you. That's just not often an option. Edit: If it helps: A progressive tax is what the US have. India may as well, that I don't know.
  - IaacForHire 4y ago
    Well now I have a better idea of how much my friend makes (she's an exec at a big company). I just lost my sympathy for her.

silvestrov 4y ago

So very wrong. $102k/year = DKK 759288/year = DKK 63274/month. Typing 63274 into https://hvormegetefterskat.dk https://hvormegetefterskat.dk (howmuchaftertax) says 40.2% tax rate. The you have to factor in $0 in health costs (gratis hospital and doctor visits), no payments for kids attending university, 32 weeks of paid maternal leave, and 5 weeks of mandatory holiday each year.

yrgulation 4y ago
There is no such thing as “free services”. You paid for them through taxes. Also you need to factor in vat and everything else being expensive due to taxes. Dont get me wrong, denmark looks great, but as many “rich” west eu countries the country is rich but the people arent.
- silvestrov 4y ago
  And you need to factor in that Danish people do not need to pay for health services. $50k after tax in Denmark needs to pay for fewer expenses than $50k after tax in USA. So it is not a valid comparison to just compare income tax and VAT. In this case Denmark ends up not being more expensive for a nice middle class life. It's just that ill-informed people thinks otherwise. Quality of life in Denmark is higher: https://www.usnews.com/news/best-countries/rankings/quality-of-life https://www.usnews.com/news/best-countries/rankings/quality-...
IaacForHire 4y ago
> The you have to factor in $0 in health costs (gratis hospital and doctor visits), no payments for kids attending university, 32 weeks of paid maternal leave, and 5 weeks of mandatory holiday each year. This sounds great if you're the type to have a family. Otherwise, seems like you kind of get screwed?
- mdorazio 4y ago
  Compared to what? In California I was paying a full 35% effective tax rate on top of something like 3000 a year in health insurance/deductibles and still had a sizable homeless camp on my street. Plus if I wanted to go back to school for an advanced degree the cost was a joke. In the US you can definitely bring home more dollars in absolute terms, but I've found if you actually compare total life costs and standards of living you end up at fairly similar % between SV and Europe.