121–130 of 133 posts
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Can you be more explicit ? Minimum car insurance is mandatory, and you can pay for full insurance if you want.
Full insurance in European Union often has explicit exception for Albania if you bring your car from there.
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> While I am not so sure about Lithuania (lower GDP per capita than Bucharest ...) Why are we comparing a country with a city in GDP per capita terms? And is this meant to imply that standard of living is higher in Bucharest than, say, Vilnius? I would assume two cities with similar GDP per capita (as Vilnius and Bucharest) can have wildly different standard of living depending on many other factors.
I can only speak about Bucharest as that's the area I know best. From what I see it has a slightly higher GDP per capita than Lithuania, and if you factor in the metro area, Bucharest has the same population as the country. "And is this meant to imply that standard of living is higher in Bucharest than, say, Vilnius?" Statistically, it is, albeit by a small margin. There is also Cluj Napoca (Romania's second or third…
I was thinking of "standard of living" as something akin to "quality of life" (which is subjective of course, but here are a couple of rankings placing Vilnius above Bucharest [0][1][2][3]). Also, for someone working remotely, a lower GDP per capita (assuming good infrastructure, low inequality/poverty/crime and corruption, etc. which are true in Vilnius, at least) might be preferable.
That being said, I think the trend for most of these statistics (GDP, HDI) for Lithuania vs Romania (or Vilnius vs Bucharest) seems to favor the former as well.
e.g. Vilnius county went from 0.861 to 0.920 HDI (0.59 delta) between 2009 and 2019; Bucharest went from 0.898 to 0.933 HDI (0.35 delta) in the same time period [4]
[0] https://mobilityexchange.mercer.com/Insights/quality-of-livi...
[1] https://www.numbeo.com/quality-of-life/rankings.jsp
[2] https://worldhappiness.report/ed/2020/cities-and-happiness-a...
[3] https://ec.europa.eu/regional_policy/en/information/maps/qua...
[4] https://globaldatalab.org/shdi/shdi/LTU+ROU/?levels=1%2B4&in...
I just want to throw out there that this is nice, but it's zero in Panama on foreign source income. The country uses the US dollar and is quite stable and modern. I used to live there, and I want to go back to that tax system as soon as I can.
My understanding of “foreign sourced” is that it usually applies to things like pensions, dividends, rental income. If you’re working, the source of the income is where you do the work - not saying you can’t fly under the radar and not pay tax, and each country has its own specific nuances and laws so Panama may allow it, but if you’re living and working remotely in a territorial tax country then that’s “locally sour…
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No social security to speak of. Health care is excellent and reasonably priced, so not too big a deal. Set aside some savings and get some basic insurance / critical illness insurance. No pension either, so plan for your own retirement. With what you save on taxes you can do that and take three months of awesome vacation a year anywhere you want and still save money over most countries.
So they literally don't take any tax for foreign income and don't require any social security payments? That's seriously awesome. Actually I specifically like it because, while I'm paying here those social security contributions for pension etc, I've no idea if I'm gonna be able to use them for the retirement, since I'm not a citizen, and not sure if I'm ever going to be one. By paying those I'm helping other people…
But all of that seems small in comparison to the tax break that you get. You could spend the whole summer in Europe or North America if you wanted and it would be free, including food and entertainment, and you'd still have plenty left for a medical and retirement savings account for yourself.
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Unless you're actually living in a tax haven or a third world country with no CFC laws, you're almost certainly breaking the law with this. The conversations I have had with people who have found the gold wheel is mind boggling, and they almost all get in trouble at some point.
It may be possible; maybe not 2.5%, but total tax rate below 10% is possible =legally= in some places. Yes, it is a punch in the face from the governments to people that pay huge taxes like 50-70% in most of Europe, but this is what governments are very good at doing: discriminating.
Through the history there are loads of examples: Warren Buffer paying lower tax rate than his secretary (ever got interested how?), Eduardo Saverin denouncing US citizenship in favor of Singapore citizenship and saving hundreds of millions in taxes.
Right now I hire contractor developers in Ukraine and they pay 5% on their income + minor accounting fees.
There are loads of government incentives around the globe, especially for the IT people.
US is the worst of citizenship in terms of taxes. You pay taxes citizenship-based on your worldwide income, while most of other countries tax residents, not citizens.
In a short, move away from a high-taxation country in a low-taxation country and enjoy the benefits. Or become a perpetual traveler and be a tax resident of NO country. There are loads of countries that offer good balance between taxes and life quality.
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I was working with a Ukrainian guy for a few years, and he was always complaining about taxes and how he wanted to pay less. Eventually he told us he was paying an effective tax rate of 7% :D
Considering how tax money are being used in these countries, even 7% is too much. I don't mind taxes, but there's too much embezzlement so some dude in the parliament can buy lambos. An issue common to countries in the region, but less so in Poland or Romania.
Do you think they're all that better
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Could you elaborate? Of course I do have a local accountant, and if what you're saying is true, I am disappointed she didn't mention that; they just said, paying salary will end up being more expensive than dividends.
By paying yourself with a salary via your company, you'd pay 10% revenue tax + health insurance (ЗО) + social insurance (ДЗПО, ДОО)... except the insurance part is capped on a maximum revenue of 3000 BGN or something like that... so as you make more money, your total tax rate converges to 10%. Take these numbers with a grain of salt because I'm no accountant, but I know for sure your accountant is wrong, because I kn…
If we take a gross income of 20K BGN (which is not a bad income for a software engineer), then with dividends, net income will be roughly this:
20000*0.9*0.95-710*(0.148+0.05+0.08) = 16902, which means taxes are 15.59%.
20000*0.9-3000*(0.148+0.05+0.08) = 17166, which means taxes are 14.17%. It's lower than dividends, but still far from the 11.5% that you mentioned.
50000*0.9-3000*(0.148+0.05+0.08) = 44166, so the taxes are around 11.67%.
I guess there can be some bonuses which aren't taxed, and this way one could reduce the tax, but paying large bonuses to myself smells too much to me since it's clearly done just to pay less taxes.
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He is probably adding VAT to his income tax rates, which imo is not correct.
Is vat not a tax? I think every government cost that is a percentage of income or spending should be calculated as your expense for the government. I think inflation also should be kept in mind as it is a hidden tax. Maybe harder to calculate.
When I measure my revenue, I always leave VAT out. It was never my money.
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Considering how tax money are being used in these countries, even 7% is too much. I don't mind taxes, but there's too much embezzlement so some dude in the parliament can buy lambos. An issue common to countries in the region, but less so in Poland or Romania.
What about 40+ per cent charged in South Europe countries? Do you think they're all that better
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I can only speak about Bucharest as that's the area I know best. From what I see it has a slightly higher GDP per capita than Lithuania, and if you factor in the metro area, Bucharest has the same population as the country. "And is this meant to imply that standard of living is higher in Bucharest than, say, Vilnius?" Statistically, it is, albeit by a small margin. There is also Cluj Napoca (Romania's second or third…
If standard of living is purely defined as GDP per capita, then it makes sense. I was thinking of "standard of living" as something akin to "quality of life" (which is subjective of course, but here are a couple of rankings placing Vilnius above Bucharest [0][1][2][3]). Also, for someone working remotely, a lower GDP per capita (assuming good infrastructure, low inequality/poverty/crime and corruption, etc. which are…
> but here are a couple of rankings placing Vilnius above Bucharest [0][1][2][3]
informative, thanks for this!
> HDI
dang, i didn't consider looking into HDI. not sure how it's measured but it places bucharest-ilfov on par with parts of the UK and east switzerland?
https://globaldatalab.org/shdi/shdi/ROU+CHE+GBR/?levels=1%2B...
Either way you are right, quality of life is subjective. I don't particularly enjoy life here overall, just taxes and the group of friends I have. Romania is far behind central and western europe in terms of mindset, but is nowhere near the low level i thought it was.