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Comment by ordo_inf | Hacker News Reader

I live in Sweden too. Is that true? I thought it was more around 4k EUR. Or am I being lowballed here...

Oh I meant in terms of cost for the employer. As they have to pay additional taxes on top of the salary. E.g. the so called “employer’s fee” and pension fees (tjänstepension) and stuff like that.

BTW, if you want to go into details, feel free to shoot me an email.

The additional mandatory fees are around 30% https://sv.m.wikipedia.org/wiki/Arbetsgivaravgifter_i_Sverig...

So with 4 kEUR gross salary you end up at 5.2 kEUR cash costs. Then there are also non-cash costs, like 5 weeks of paid holidays (or did unions actually achieve the 6th one? It's 30 years I lived in Sweden...)

And you might need an office, equipment, and what not. So the cost can easily be 6-7 kEUR even if the developer sees only 4 kEUR on their payslip.

A few might earn (significantly) more. But that's more likely in corporations higher levels than for open source related development work.

Yes. An employer must also take into account the average sick time per employee and year, since it pays for sick pay day 2 - 14 when the employee is sick. That is an another contribution to the 2x ballpark number.

In Germany you pay/get 13 - 14 monthly salaries per year. In Finland 12.65. Don't know the figure for Sweden, but I'm pretty sure it's > 12.

Please, there are no additional costs for the employer. On paper yes, but from where do you think those "additional costs" are paid? Right, from the value an employee creates.

and their salaries?

Employees salaries? They're paid because employees create some value for an employer. Where do you think money for salaries comes from anyway?

I had a friend who owned a company at the time. His sole criteria for hiring was that net salary + taxes + health insurance + all additional costs (yes, even those "paid by employer") must be <= the money employee earns him.

In Sweden, what you get paid isn't really your full salary. Sweden has a hidden tax system called "arbetsgivaravgift" which only the employer can see. It's hidden and not labeled as a tax because it tricks people into believing you're paying less taxes than you actually do.

So when you think you're paying ~32% income tax, in reality it's closer to 50%.

> It's hidden and not labeled as a tax because it tricks people into believing you're paying less taxes than you actually do.

That's some conspiracy bullshit. The first Google hit for "arbetsgivaravgift" gives the site of the Swedish IRS-equivalent, where it's both clearly marked as a tax and the exact percentage is given.

But the employee does not see it on their pay slip, unlike the regular taxes and pension. So when people (aka employees) talk about taxes it is rarely mentioned. In that regard it is a hidden tax.

My boss told me he when thinking about our pay he considers the expense to the company to be about 2x what we get paid (pre-tax). So that's the "arbetsgivaravgift" (we got the same thing here in Norway) and pensions on top of our salary.

It's not paid by the worker, it's paid by the employer. There no more need to have it on the pay slip than any other per-employee expenses.

Let's say I'm the king of Sweden, and I take back the power from that annoying parliament. I want to appease my people and show that I will rule in favor of the average Joe and against the big evil corporation. So I cut the personal income tax rate by 10%, and I raise the arbetsgivaravgift rate by 10%.

Unless I also forbid renegotiating salaries, don't you think that after a short amount of time "gross" salaries (effectively salaries net of arbetsgivaravgift) will have adjusted and everything will be the same?

If the worker doesn't earn for all these costs "paid by employer", the company would soon go bust.

2x is a good ball park figure that's also true for Germany. Of course it's not strictly taxes, but material, hardware, rent... if you as an employee have a gross sum of 50k, the employer should calculate with up to 100k. If it's less, even better.

> That's some conspiracy bullshit.

It's not a conspiracy at all. The US does it too with the employer portion of FICA. This is 15.3% for most employees.

Hiding this tax that directly impacts what your cash paycheck will be is certainly political. But conspiracy? Not at all. It's like any other social nudging - keeping it out of sight and out of mind is absolutely on purpose and not really arguable. What is arguable is if it's justified.

> That's some conspiracy bullshit.

No it's not.

It's not really hidden though, and there is nothing preventing from it being displayed on payslips, it usually just isn't.

It is still a cost.

Yes... one that is paid from the value the employee creates.

The point here isn't how valuable the employee is, it's how much of a developer's time this donation buys.

In this context are you saying that paying tax is a donation by the taxpayer/employee to the government?

No. What I'm saying is that if you want to know how much developer time Debian's donation buys, you need to look at how much it costs Peertube to buy developer time, which includes all taxes Peertube must pay on employment, not just how much of that money shows up on the developer's paystub.

Yes, it is a cost which is paid solely by employees. Where do you think money for paying that cost comes from?

I never said anything about that. Just arguing against your false claim "there are no additional costs for the employer". If you mean something else, say that instead.

No, I meant what I said. People think those are "additional costs" just because their payslip says "additional costs". To the employer, it's a simple math of "employee costs me X" compared to "employee earns me Y". All successful companies have Y > X. All bankrupt companies have Y < X.

Sweden's great at obfuscating how high effective income tax actually is; payroll tax ("arbetsgivaravgift") and social fees are charged on the employer's side and never seen on your payslip (and are, depending on income, almost comparable to income tax).

That's not even accounting for non-salary costs.

~7-8k EUR effective cost for 1 person-month sounds about right to me.

10k for the average developer (in Europe) sounds a bit too high, 4k a bit too low, but closer to what I would expect.

A lot of Europe is the balkans and the east where I'd be surprised if the average employer cost for a decent developer exceeds 2k/month.

True, I should have said most of Western/Northern Europe, I guess.

Edit: Actually, Europe is so diverse that any blanket statement is mostly worthless.

If you work in Stockholm you could easily get closer to 5k or even above that if you have some experience. If you work somewhere else the figure could be smaller.

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