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Why higher-income workers in California may get surprised by tax hike in 2024

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Re: Why higher-income workers in California may get surprised by tax hike in 2024

#51

Post by s1artibartfast »

refurb wrote: post #43
s1artibartfast wrote: post #11

Earlier quoted context omitted.

It is actually a lot closer than you think if you add up all the different taxes for each country.

It's actually a greater difference. VAT in the EU is 21% on average. Gasoline taxes are more than double. The easiest way to see the difference is tax revenue as a percentage of GDP. France is 46%, Germany 37%, UK 33%. The US is 27%.

That is federal. Add in states and cities and US government revenue is more than 40% of GDP [1].

When you consider actual dollars, not % gdp, Americans pay MORE in actual dollars than many European countries.

https://upload.wikimedia.org/wikipedia/commons/3/37/Federal%...

France gdp/capita is around 43,658.98 USD. 47% is $20.5k/capita.

US gdp/capita is around 66,000 USD. 40% tax revenue is $26.5k/capita.

The US government brings in 30% more tax revenue per resident than the French government.

The differences in social benefits between France and the US are not due to lower taxes in the US. They are due to inefficient spending and systemic economic differences.

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#52

Post by refurb »

s1artibartfast wrote: post #51
refurb wrote: post #43

Earlier quoted context omitted.

It's actually a greater difference. VAT in the EU is 21% on average. Gasoline taxes are more than double. The easiest way to see the difference is tax revenue as a percentage of GDP. France is 46%, Germany 37%, UK 33%. The US is 27%.

That is federal. Add in states and cities and US government revenue is more than 40% of GDP [1]. When you consider actual dollars, not % gdp, Americans pay MORE in actual dollars than many European countries. https://upload.wikimedia.org/wikipedia/commons/3/37/Federal%... France gdp/capita is around 43,658.98 USD. 47% is $20.5k/capita. US gdp/capita is around 66,000 USD. 40% tax revenue is $26.5k/capita. The US gover…

I have no idea where you data comes from, but the OECD tax data (the one I quoted) includes all levels of government, property taxes and sales tax/VAT.

"This indicator relates to government as a whole (all government levels) and is measured in percentage both of GDP and of total taxation."

https://data.oecd.org/tax/tax-revenue.htm

The OECD data has the US at 34% and France at 45%.

And the idea that "the US pays more taxes doesn't even pass the sniff test. You only need to look at income tax rates, VAT, etc and anyone can tell that's not true at all.

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#53

Post by gmerc »

HDThoreaun wrote: post #50
personomas wrote: post #49

Earlier quoted context omitted.

That's based on our life habits, not on health care. That's crazy talk.

Right, our life expectancy is shorter because of life choices, so it can't tell us anything about healthcare quality.

Lack of accessible healthcare and medical bankruptcy as one of the primary drivers of financial failure and old age poverty is not life choices.

Gun death as a leading cause of youth deaths is not life choices.

PFAS exposure is not life choices.

A medical system that allows advertisement and more or less open bribery leading to an opioid crisis that’s killing enough people to bring down life expectancy across the midwest is not life choices.

Ineffective pandemic management by the government is not a life choice.

Obesity is a boogeyman, but it has been around for long enough that the recent significant drops in life expectancy cannot be blamed on it. And even obesity is likely not a pure life choice, food quality and regulation of food supply play a vital role.

I always found it amusing that we pump estrogen / hormone affecting chemicals into things and then give people a hard time if they have gender identity challenges and call it a life choice despite all the science to the contrary.

Life choices are a catch all diversion, a fairy tale people tell themselves to feel like they have power to avoid the horror.

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#54

Post by appplication »

Reubend wrote: post #3
hnburnsy wrote: post #2

From Bogleheads... >This also effectively increases the maximum marginal tax rate for CA high earners. The maximum marginal rate is now: 37% Federal + 2.35% Medicare + 13.3% CA Income + 1.1% CA SDI = 53.75%

That makes California the state with the highest marginal tax rate. It also puts California very close to the European countries with the highest margin tax rates (for instance, Spain and France have similar rates). My opinion: High tax rates in Europe are the "price" of free (or very cheap) healthcare, cheap university education, and a strong social welfare net. But Californians at the high end are paying almost the…

> Californians at the high end are paying almost the same price, and missing out on most of the benefits.

The context behind this statement is that Californians at the high end are also making over $650k/year. That said, I agree with your general point about generally insufficient healthcare and increasing taxes on corporations.

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#55

Post by s1artibartfast »

refurb wrote: post #52
s1artibartfast wrote: post #51

Earlier quoted context omitted.

That is federal. Add in states and cities and US government revenue is more than 40% of GDP [1]. When you consider actual dollars, not % gdp, Americans pay MORE in actual dollars than many European countries. https://upload.wikimedia.org/wikipedia/commons/3/37/Federal%... France gdp/capita is around 43,658.98 USD. 47% is $20.5k/capita. US gdp/capita is around 66,000 USD. 40% tax revenue is $26.5k/capita. The US gover…

I have no idea where you data comes from, but the OECD tax data (the one I quoted) includes all levels of government, property taxes and sales tax/VAT. "This indicator relates to government as a whole (all government levels) and is measured in percentage both of GDP and of total taxation." https://data.oecd.org/tax/tax-revenue.htm The OECD data has the US at 34% and France at 45%. And the idea that "the US pays more…

Even using your numbers from OECD, US taxes revenues per capita are still higher than France in real dollars ($22k vs 20k)! The US Government doesn't have a revenue problem, it has an efficiency and cost control problem.

For example, The US government healthcare spending per capita is 2.5X (250%) that of France- ($10.5K vs $4K per person), and France gets a universal national health insurance for that price, and the US gets medicare and medicaid. [1,2] Yes- you read that right, and it is still true if you adjust for PPP.

The same phenomenon holds true across almost every aspect of US government spending.

Look at infrastructure. The cost to build subways and light rail in the US is 2-7 times higher than in Europe. [3]

Look at defense. US spends ~300% as much as France, which is actually higher than most western European countries.[4]

From a purely numerical sense, the US can't overcome an efficiency problem by raising taxes and throwing more money at it.

1 https://stats.oecd.org/Index.aspx?DataSetCode=SHA

2 https://www.cms.gov/data-research/statistics-trends-and-repo....

3 https://www.nextbigfuture.com/2018/01/subways-and-light-rail....

4 https://en.wikipedia.org/wiki/List_of_countries_by_military_....

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#56

Post by personomas »

s1artibartfast wrote: post #55
refurb wrote: post #52

Earlier quoted context omitted.

I have no idea where you data comes from, but the OECD tax data (the one I quoted) includes all levels of government, property taxes and sales tax/VAT. "This indicator relates to government as a whole (all government levels) and is measured in percentage both of GDP and of total taxation." https://data.oecd.org/tax/tax-revenue.htm The OECD data has the US at 34% and France at 45%. And the idea that "the US pays more…

Even using your numbers from OECD, US taxes revenues per capita are still higher than France in real dollars ($22k vs 20k)! The US Government doesn't have a revenue problem, it has an efficiency and cost control problem. For example, The US government healthcare spending per capita is 2.5X (250%) that of France- ($10.5K vs $4K per person), and France gets a universal national health insurance for that price, and the…

No, you're completely ignoring the facts that @refurb is stating. The US govt is also extremely inefficient, true, but taxes in the US are far less than in Europe, on average.

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#57

Post by s1artibartfast »

personomas wrote: post #56
s1artibartfast wrote: post #55

Earlier quoted context omitted.

Even using your numbers from OECD, US taxes revenues per capita are still higher than France in real dollars ($22k vs 20k)! The US Government doesn't have a revenue problem, it has an efficiency and cost control problem. For example, The US government healthcare spending per capita is 2.5X (250%) that of France- ($10.5K vs $4K per person), and France gets a universal national health insurance for that price, and the…

No, you're completely ignoring the facts that @refurb is stating. The US govt is also extremely inefficient, true, but taxes in the US are far less than in Europe, on average.

I simply dont think that is true on a factual basis. The US taxes as a % of GDP is a few percent behind Europe, but GDP is higher in the US.

The US government pulls in more dollars of revenue per resident than most European countries.

the OECD data refub provided matches up with my claim. Do you have other data?

You can validate this with the opposite approach. Looking at government spending [1] The US government spends 31.5k per person. Germany spends 31.8k per person and France spends 32.3k per person. Deficit spending is a few percent higher in the US, but pretty similar. Switzerland, Ireland, and the UK are all in the mid 20's.

The idea that the US governments is underfunded or that taxes are vastly lower are pervasive myths.

It is based on a bait and switch looking at %GDP instead of dollars paid to the government, as if the cost of government services like roads or insulin are naturally proportional to GDP.

The entire concept of higher GDP implies you should be able to have more purchasing power, goods, and services with higher GDP.

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#58

Post by refurb »

s1artibartfast wrote: post #57
personomas wrote: post #56

Earlier quoted context omitted.

No, you're completely ignoring the facts that @refurb is stating. The US govt is also extremely inefficient, true, but taxes in the US are far less than in Europe, on average.

I simply dont think that is true on a factual basis. The US taxes as a % of GDP is a few percent behind Europe, but GDP is higher in the US. The US government pulls in more dollars of revenue per resident than most European countries. the OECD data refub provided matches up with my claim. Do you have other data? You can validate this with the opposite approach. Looking at government spending [1] The US government spe…

Ok, but my had nothing to do with all that, just that the tax burden as a percentage of income is much lower in the US than many European countries.

I never said anything about how the money is used.

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#59

Post by s1artibartfast »

refurb wrote: post #58
s1artibartfast wrote: post #57

Earlier quoted context omitted.

I simply dont think that is true on a factual basis. The US taxes as a % of GDP is a few percent behind Europe, but GDP is higher in the US. The US government pulls in more dollars of revenue per resident than most European countries. the OECD data refub provided matches up with my claim. Do you have other data? You can validate this with the opposite approach. Looking at government spending [1] The US government spe…

Ok, but my had nothing to do with all that, just that the tax burden as a percentage of income is much lower in the US than many European countries. I never said anything about how the money is used.

Yes, and I'm saying that the US tax "burden" as a percent of GDP is a misleading way of looking at it.

When it comes to real people and real "burden", what matters how much you have to hand over, and how hard you have to work for it. In this context, Americans pay more than most Europeans to their governments, and work far more hours.

This relates to upthread discussion:

>"If Americans knew what Europeans get for their tax dollars, they (Americans) would riot in the streets"... It's really insane to see Americans pay the same tax as Europeans (and Canadians, and Australians) but get so, so much less for that money.

And of the responses claiming that Americans pay less, and generally implying that Americans have it easy with respect to taxes.

Re: Why higher-income workers in California may get surprised by tax hike in 2024

#60

Post by refurb »

s1artibartfast wrote: post #59
refurb wrote: post #58

Earlier quoted context omitted.

Ok, but my had nothing to do with all that, just that the tax burden as a percentage of income is much lower in the US than many European countries. I never said anything about how the money is used.

Yes, and I'm saying that the US tax "burden" as a percent of GDP is a misleading way of looking at it. When it comes to real people and real "burden", what matters how much you have to hand over, and how hard you have to work for it. In this context, Americans pay more than most Europeans to their governments, and work far more hours. This relates to upthread discussion: >"If Americans knew what Europeans get for the…

In this context, Americans pay more than most Europeans to their governments, and work far more hours.

I disagree. Americans work more hours (not a lot more, but more) and make more money per hour and overall.

So when they have to hand over money for taxes, they hand over much less, as a percentage of hours worked. So they end up keeping more in the end.

That sounds like a lower tax burden to me.

And the upthread comment just isn’t true. Americans pay less tax overall and spend fewer work hours paying that tax. So of course they don’t get the same benefits as Europeans. That’s the trade off.

If Americans had to pay European tax rates they’d see a huge increase in tax burden., even the middle class. We’re talking a 50% increase in taxes. That’s very significant.

So if you asked Americans “do you want European level of benefits?” almost all would say yes. If you asked them if they wanted to pay much higher tax rates in exchange? A lot would say “no”.

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