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Most Danish voters oppose government plans to cut the top rate of income tax

bloomberg.com

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Re: Most Danish voters oppose government plans to cut the top rate of income tax

#131

Post by wodenokoto »

ulrikmoe wrote: post #25

This is simply not true. In Denmark we have a welfare and tax scheme that benefits the majority at the expense of the productive few and the poor (Director's law?). I have never met a danish entrepreneur who didn't complain about taxes, never ever... http://taxfoundation.org/sites/taxfoundation.org/files/docs/...

The only tax complaint I've heard from entrepreneurs in Denmark is complexity, not cost.

Most freelancers I know want out, not because taxes are too high, but because an accountant is too expensive.

Re: Most Danish voters oppose government plans to cut the top rate of income tax

#132

Post by josu »

calgoo wrote: post #117
vonmoltke wrote: post #110

Earlier quoted context omitted.

The critical failure of the welfare state, as it is currently implemented, was that it relied on ever-increasing payrolls in the younger generations to fund the pensions and subsidies of the retirees. Once that breaks down, as it is starting to, so does the system built upon it.

Yea, here in Spain most people under 35 dont expect to have any public pensions when we come of age. The system is so underfunded and corrupt that I expect to work until 75 at least and really dont expect there to be any public funding left by then. As I tell others here, get a private plan, even if you cant put a lot in it, setup an automatic transfer each month and done.

>The system is so underfunded

The system is not underfunded, its main problem is the aging population. Or maybe even the system, in Spain, as in most countries in Europe, pensions are paid by the current generation, so the moment that the ratio of pensioners to workers becomes unsustainable the system will collapse.

>and corrupt

There is some corruption going on in Spain, that's undeniable, but I wouldn't say that the pension system is corrupt. What are your bases for that statement?

Re: Most Danish voters oppose government plans to cut the top rate of income tax

#134

Post by josu »

vidarh wrote: post #83
atemerev wrote: post #10

In other countries, taxes are complicated (no citation needed). There's income tax, but there are also social security payments, industry-specific taxes, etc. And you have to pay for your own education and healthcare! Danish tax is simple and all inclusive. It is around 50%, which is about the same as in US if all hidden obligatory payments are taken into account. But it is all inclusive: all education and healthcare…

> It is around 50% No, it isn't. The total tax wedge under OECD definitions, which includes employer payroll taxes, the Danish income tax burden is on average around 38%. Excluding employers payroll taxes it's around 36%. For comparison, the "all in" number for the US is around 31%. The OECD average is 36%. The only OECD country that crosses the 50% mark is Belgium, which consistently is one of the highest tax countr…

Why wouldn't you take into account the VAT which taxes all consumption?

Re: Most Danish voters oppose government plans to cut the top rate of income tax

#135

Post by egman_ekki »

vidarh wrote: post #90
mstade wrote: post #42

Earlier quoted context omitted.

This sounds like Sweden or Norway, and I couldn't agree more.

Sweden is #8 in terms of total tax wedge in the OECD. Norway is the 18th highest and just barely above the OECD average, compared to e.g. US at #25, Belgium at #1, Germany #2. Sweden is high, but still 6-8 percentage points below Germany, Italy, Austria, Hungary, France, and about twice that beow Belgium, which is an extreme outlier.

...but the structure of the tax wedge is quite different. In Denmark, almost all of it comes from income tax while in other countries it's usually 40% paid by the employer...

Re: Most Danish voters oppose government plans to cut the top rate of income tax

#136

Post by vixen99 »

ximeng wrote: post #69
vixen99 wrote: post #26

Earlier quoted context omitted.

That's a metric that evidently appeals to you. So be it. It's a relative measure and my preference, possibly shared by others, is for an absolute one. Human nature and entrepreneurship being what it is, as general wealth increases thus does inequality increase. We have seen this happening on a grand scale across the world during the last 20 years or more. One other point: what suits the Danes wouldn't necessarily sui…

Think there's room for more nuance around saying inequality increases as wealth increases. Eg a public transit system and a limousine service could both increase the wealth of a community but might have different effects on inequality. Services like Facebook or google naturally lead to extreme inequality due to the information availability differing between the company and consumers.

I did not say that inequality increases as wealth increases. I said, it increased and so has wealth. This is a fact. We have seen the largest decline in material poverty in human history along with a massive increase in inequality. As an example, the OECD says that over the last three decades the share of Chinese living in absolute poverty has declined from eight in ten to one in ten. At the same time, relative poverty (taking inequality into account) has more or less doubled. Which metric is more important if you're a poor Chinese person?

Re: Most Danish voters oppose government plans to cut the top rate of income tax

#137

Post by egman_ekki »

vidarh wrote: post #83
atemerev wrote: post #10

In other countries, taxes are complicated (no citation needed). There's income tax, but there are also social security payments, industry-specific taxes, etc. And you have to pay for your own education and healthcare! Danish tax is simple and all inclusive. It is around 50%, which is about the same as in US if all hidden obligatory payments are taken into account. But it is all inclusive: all education and healthcare…

> It is around 50% No, it isn't. The total tax wedge under OECD definitions, which includes employer payroll taxes, the Danish income tax burden is on average around 38%. Excluding employers payroll taxes it's around 36%. For comparison, the "all in" number for the US is around 31%. The OECD average is 36%. The only OECD country that crosses the 50% mark is Belgium, which consistently is one of the highest tax countr…

I think low tax wedge in Denmark is caused by relatively low cost of an employee to the employer (who pays relatively small amounts over their salary) vs in other Western countries.

Re: Most Danish voters oppose government plans to cut the top rate of income tax

#138

Post by egman_ekki »

cloudjacker wrote: post #85
atemerev wrote: post #10

In other countries, taxes are complicated (no citation needed). There's income tax, but there are also social security payments, industry-specific taxes, etc. And you have to pay for your own education and healthcare! Danish tax is simple and all inclusive. It is around 50%, which is about the same as in US if all hidden obligatory payments are taken into account. But it is all inclusive: all education and healthcare…

Don't forget the 22% VAT on goods and services lol

It's actually 25%, unfortunately...

Re: Most Danish voters oppose government plans to cut the top rate of income tax

#139

Post by sliverstorm »

sharemywin wrote: post #124
hedgew wrote: post #35

I'm not in Denmark but in a very similar European country. I don't want the high taxes. The current taxes and mandatory payments feel unfair. The generations before us worked during the greatest economic boom in history, were mostly employed in safe and high paying government jobs (still are), bought houses before their values tripled, and are now receiving monthly pension payments that are almost twice what most you…

But the problem is a lot of them paid in already. so, should someone that worked 40 years for a system get screwed out of all the money they put in? I don't have a good answer.

You try not to leave them totally high and dry, but you can't shift the entire burden onto people who weren't even born when those deals were made. It wasn't the unborn that screwed them, it was their own elected politicians who did it, in other words, themselves.

Re: Most Danish voters oppose government plans to cut the top rate of income tax

#140

Post by tpeo »

badsock wrote: post #127
hedgew wrote: post #35

I'm not in Denmark but in a very similar European country. I don't want the high taxes. The current taxes and mandatory payments feel unfair. The generations before us worked during the greatest economic boom in history, were mostly employed in safe and high paying government jobs (still are), bought houses before their values tripled, and are now receiving monthly pension payments that are almost twice what most you…

Wait, you've got it backwards. At the risk of stating the obvious: the wealthy older generation are the ones who want the tax cuts for the wealthy. In a progressive taxation scheme the young and poor get more benefits from the government than they pay in via taxes, so what you're arguing for would hurt you and help them. The real problem is that assets are taxed (sometimes significantly) less than income. We're in a…

The situation you're referring to, where older citizens own more assets than average, might indeed seem obvious in Canada but it might not be the case at all in any country with a differently structured social security system, since the decision to save money for a rainy day or not is directly affected by the availability of social security.

In a country with an ageing population and with a pension system overwhelmingly funded by intergenerational transfer, then voting for tax cuts is optimal for young voters. In a country where pensions are mostly funded by private savings, then sure, taxes are nice.

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