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Comment by vidarh | Hacker News Reader

Where are you getting 50% from? Everything I can find suggests tax rates in Brazil are below those of most OECD countries, and well below the OECD average for example, and the full tax wedge (which includes employer contributions) average for OECD for every category they report on is below 50% [1].

[1] OECD numbers are available from OECD's Taxing Wages 2020 report: https://www.oecd.org/tax/taxing-wages-20725124.htm

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The 50% is calculated from all benefits (vacations, etc). For a large company and hourly wages, it can go up until 95%.

Source: http://www.guiatrabalhista.com.br/tematicas/custostrabalhist...

Don't know how accurate this website [0] is but it shows a 68.17% employment cost versus 31.42% for sweden [1]. Wow that is a lot if it's true.

[0]: https://papayaglobal.com/countrypedia/country/brazil/

[1]: https://papayaglobal.com/countrypedia/country/sweden/

The person I replied to argued 50% of a person income would go to tax:

> and then pay 50% of everything that you make in taxes for this wonderful protection

For non-salary labour costs to make up a large amount relative to salary is a very, very different argument.

Sweden places the tax burden on the individual not the corporations. Their Corp tax rat is 21%. The same rate that the Republicans pushed for in the tax change. The difference is the average citizen is taxed at 48% vs the US average of 21.

But does that take health care and other benefits into account ?

It takes into consideration health care.

Really I am not convinced - I know a UK expat (worked for Citi bank) and he was paying well over 15% just for heath care just for him - and his wife already had federal benefits (Something senior in the FBI)

Total tax wedge (which includes taxes paid by the employer) for an average Swedish citizen without children is ~43%. For one with children it is lower.

Total taxes paid by the employee for an average Swede is closer to 25%.

The highest marginal rate for someone on an average salary in Sweden is around 48% for the total tax wedge, but someone on the average is not paying that marginal rate.

For the same categories the total tax wedge for the US is 24%, and the total tax ~18% (for comparison the marginal rate for an average earner in the US in the same category is 40.8%)

Source: OECD Taxing Wages 2020

If you look at the spreadsheets you will see, for example, the 13th salary included as overhead. It's not overhead: it's part of employee income and goes directly in their pocket.

The 95% figure is for hourly employees and counts worst-case expenses over their raw hourly rate. In every other country vacations (including weekends!) are just counted as employee income and in that spreadsheet it's accounted as some sort of tax. Every country's overhead rate would go up if you accounted things in this absurd way.

The FGTS is a really stupid scheme that should die but ultimately goes into the employee's pocket, so it's also a form of income and not a tax. (It's a kind of mandatory savings account.)

You are looking at taxes. There is probably more taxes in the form of health insurance / retirement thing. It's incomparable to Europe since in most EU countries you probably get some coverage in return to the money you paid while, in third-world countries, health care is sub-bar or non-existent.

As for retirement, inflation will probably eat that.

The numbers I compared to were the "full tax wedge" numbers which includes social service payments both on the employee AND employer side on top of income taxes. I on purpose picked the category that gives the highest numbers in the OECD report, well above the numbers people will see on their tax returns in most cases.

I'm sure the commenter above was including something else, which is what I'm curious about, given that as far as I can tell the highest marginal federal tax rate I can find is only 27.5%, and average effective rates far lower, but I don't know what other costs people might incur.

If Brazil is in fact a higher tax country than most of the wealthiest countries in the world, I'd love to know more.

Brazil health care is actually decent, better than the American for sure.

Universities are also free.

Regarding universities, they may be free, but the number of admissions is very, very limited. The competition is very harsh. In reality, most people who are able to get in are those capable of paying for very good schools or preparatory courses, and these courses can be very expensive [0]. Sometimes, people have to try for years before being able to join those universities [1].

When your family is very poor, this situation makes it impossible for the student to keep on trying. Sometimes parents can't keep paying for the preparatory course, or worse, the student may have to forfeit it's dreams of studying in favor of working and helping with household expenses.

As seen in [0], most people studying in free universities are actually in a pretty good financial situation.

Sometimes, people from very poor families manage to study for free, but this is rare and often newsworthy [2].

In my humble opinion, I don't think universities are really free. There are many financial costs associated with studying in a public university.

[0] http://www.brasil-economia-governo.org.br/2016/06/15/como-as... [1] https://g1.globo.com/pb/paraiba/noticia/2020/01/29/paraibano... [2] https://diariodonordeste.verdesmares.com.br/metro/estudante-...

Corporate taxes alone are 34%, one of the highest in the world.

Great! Corporate taxes hit both productive capital and labor!

Income taxes disproportionately hit labor in a world were capital is becoming more and more concentrated.

The person I replied to wrote:

> and then pay 50% of everything that you make in taxes for this wonderful protection

about employees.

I don't see how corporation tax is relevant to that.

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