Hacker News Reader

Hacker News

Comment by kokojie | Hacker News Reader

Parent Full thread

kokojie

Some European country tax 90% of income...

View on HN

Yeah, and all americans have guns and ford f150. /s

https://tradingeconomics.com/country-list/personal-income-ta...

Even the US had a 94% tax rate on income over $200,000 in 1944 and 1945:

https://en.wikipedia.org/wiki/Income_tax_in_the_United_State...

Mind you - at the same time it looks like the UK had a comparable taxation rate of over 99%.

Reaching 90% is hard, even if you count additional taxes. Take Sweden, where you first remove 31.42% social tax, then 60% income tax, then 25% VAT. You will still end up with 24% of money left of the initial payroll.

If I make a sale in Norway for 100 NOK:

Business VAT: 20 spent (20 %) 80 NOK left.

Income tax: 39 spent (max ~49 %) 41 NOK left.

VAT on purchase: 8.2 spent (20 %) 32.8 NOK left.

67.2 % taxes.

If I spend my money on gas/diesel then I would have ~16 NOK of value left. (84 % taxes)

About 18 % of the income tax I'll get back during my pension.

So 90 % is probably achievable on some things in some countries.

You are not spending the first 20 NOK of your sale, you are just collecting them from the customer. If VAT was 0% then your sale would be for 80 NOK.

Sure I am. If I didn't have to collect VAT then I could sell for 100 NOK instead.

It's not my money, but I still have to bill for it and pay it. The customer doesn't get a better product or service because of it.

If the customer didn't pay the VAT, they'd end up paying their taxes some other way and still have less money to spend on your products.

> Some European country tax 90% of income...

This is untrue.

If I make a sale in Norway for 100 NOK:

Business VAT: 20 spent (20 %) 80 NOK left.

Income tax: 39 spent (max ~49 %) 41 NOK left.

VAT on purchase: 8.2 spent (20 %) 32.8 NOK left.

67.2 % taxes.

If I spend my money on gas/diesel then I would have ~16 NOK of value left. (84 % taxes)

About 18 % of the income tax I'll get back during my pension.

So 90 % is probably achievable on some things in some countries.

Huh? Why are you accounting for VAT twice? Either you consider that the business 'pays' the VAT or you 'pay' the VAT, you don't get it both ways.

It is both ways, for me. My business pays VAT on sales, and I personally pay VAT on purchases, so for me and my business VAT will be paid twice. Both for what I sold and what I(personally) purchased.

Either the consumer is paying the VAT or the business. You can't say that the business pays the VAT when you are the business, but the consumer pays the VAT when you are the consumer. If you frame it as you "personally purchased" something and paid VAT, then what you sold as a business to someone else was "personally purchased" and had the VAT paid by them too.

Source? European, never heard of this. Though a 15% rate is pretty normal around here.

Income tax? Sure. Wealth tax? No, of course not, then investments would basically never be a good idea.

It's existed in the past.

Look up the lyrics for the Beatles song "Taxman", "There's one for you, nineteen for me".

I recall income tax over 110%. It was author in scandinavian country.

70% is pretty normal if you count all compulsory insurances.

That seems unlikely. Work and earn 100, and owe the government 110; or dont work / earn 0, owe the government 0?

Being net negative for productivity is literally counterproductive.

https://skeptics.stackexchange.com/questions/15235/did-swedi...

That's marginal tax rate. Many people pay an effective marginal tax rate of more than 100% if you include government programs like social housing. In fact, when you earn around €2200/month here, it is possible to end up with net less than if you don't work at all, due to various programs.

The accepted answer explains why that is not a tax over 100%.

Reply on news.ycombinator.com