From: sundinKC@dna.lth.se (Anders Sundin)
Newsgroups: soc.culture.nordic
Subject: Re: Ruling parties in Norden
Date: 16 Apr 92 22:14:15 GMT
Article-I.D.: lth.1992Apr16.221415.6857
Organization: Organic Chemistry 2, Lund University, Sweden

matsd@physchem.kth.se (mats dahlgren) writes:
> In article <1992Apr13.231413.28372@CSD-NewsHost.Stanford.EDU>,
> baker@Xenon.Stanford.EDU (Andrew Baker) writes:
> >
> >... before anyone
> >decides that New Jersey (or anywhere in the US) is some kind of tax
> >haven, I would like to note several things.
> 
> And I'd like to comment on these from a Swedish point of view...
> 
> >The top federal tax rate
> >is 31% right now, and presumably you have added the top New Jersey
> >tax rate to get the 38%.
> 
> The top federal (marginal) tax rate (on salaries) is 20%.  When local
> taxes (county and township) are added it's 55% or so (depending on where
> you live).
>
> >However, there are also other taxes:
> >(1) The U.S. Social Security Tax comes to around 15% (when you include
> >both the employee and employer contributions).  If you make enough money,
> >this marginal rate will eventually drop to 0%, but few people make this
> >much.  There are also things like unemployment insurance and so forth,
> >but these don't usually amount to very much.
> 
> The Swedish equivalent "arbetsgivaravgift" is 37%.
> 
> >(2) New Jersey has a sales tax.  When I lived there, it was 5%; on general
> >principles, I would guess that it has gone up since then.
> 
> The Swedish sales tax (or VAT), "moms", is 25% according to the U.S. way
> of counting on all goods and services except for transportation, food
> and hotel accomodation, for which it is 18%.
> 
> >(3) Most towns have property taxes.  If you have a nice house, this can
> >come to a lot of money.
> 
> The federal state collects property taxes.
> 
> >(4) A few big cities charge wage taxes to people who work there (so you
> >get taxed where you live and where you work).
> 
> This is not practised in Sweden (correct me if I'm wrong).
> 
> >(5) Corporate income is taxed twice.  First corporate profits are taxed,
> >and then any portion of these profits that are passed through either as
> >dividends or as capital gains are taxed again as personal income.
> 
> Same here...
> 
> >(6) The taxation of investment income doesn't take inflation into account.
> > [...]
> 
> Same here...
> 
> >(7) I have been told that the U.S. tax system is one of the most complicated
> >in the world.  This means that if you want to find loopholes, it will cost
> >you a lot in time and expert advice.
> 
> Fortunately, we don't have *this* problem to the same extent anymore.
> That's one of the good effects of the recent taxation reform.
> 
> >(8) U.S. politicians have a penchant for changing the tax laws with
> >extraordinary frequency. There are around four people running for President
> >right now.  One wants to cut the capital gains tax.  Another apparently
> >wants to create two new tax brackets above the 31% level (36% and 46%).  A
> >third wants to create a flat income tax and a VAT, but apparently he has
> >worked out so few details that no one can quite figure out what it would
> >amount to in practice.  And still another guy says that we have to scrap the
> >whole system and start over, but he won't know what needs to be done until
> >he gets elected!  Needless to say, this is not the optimal situation for
> >advance tax planning.
> 
> We sort of have the same problem.  Since some details in the taxation
> system changes from one year to another -- somtimes with short notice --
> a *healthy* planning of one's economy is practically impossible.
> 
> Compared to Sweden, New Jersey seems to be pretty well off -- as far as
> taxation is concerned.  I'm aware other things are better in Sweden, but
> that doesn't lessen the need for improvements in some areas.
>

I agree that there is certainly room for improvment in the Swedish tax system.
However, I would like to point out that all percentages are not created 
equal... :-)

Correct me if I am wrong but should we not compare like this (I pull out my
trusted HP calculator). Lets say that one US $ is 6 kr.

Swedish taxes as above                            US taxes as above
 300000                     "Cost of salary"                50000
-111000  37%           employer tax | social sec    15%     -7500    
-------                                                    ------
 189000                         "Salary"                    42500
-103950  34.65% (=55% of    Federal+local tax       38%     19000    
-------          189 kkr)                                  ------
  85050                  Money left for consumption         23000
 -18711  22% (18-25)         Tax on consumtion       5%      1150
-------                                                 ------
  66339                      What we have left              21850

Then the swedish taxpayer has 66,339 kr ($11,056) left while the american
has 131,100 kr ($21,850).
If this is true (the 55% of 189000 seems high to me) then:
a) What is normally called Salary should generally be multipiled by 1.6 before
   it is compared with an american salary.
b) Even then the swedish tax-payer has little more than half of what the
   american has when all taxes are paid. (50.6% to be exact).
c) If the federal+local tax (55% above) in Sweden then it should be recalculated
   to (to 35% above) to compare directly to the american federal+local tax.

It would be interesting to hear from americans how much they have to spend for:

Item             Situation in Sweden.
--------------   --------------------
o Rent           Directly and/or indirectly subsidised.
o Health care    Only minor fees to avoid abuse.
o Dental care    Subsidised.
o Schools        In general no fees to attend schools at any level.
o Pension        Paid via the General Pension, ATP.
o Sick-Pension   Paid.
o Kindergarten   Large parts of it is paid.
Etc.

It would also be interesting to compare the standards of living for the
unemployed, and for families with childeren who also recive a substantial
child-salary (barnbidrag) until the children are grown up.
-- 
 Anders Sundin           e-mail: sundinKC@dna.lth.se
 Organic Chemistry 2             Anders.Sundin@orgk2.lth.se
 University of Lund              ok2aps@seldc52.bitnet
 P.O. Box 124            phone:  +46 46 108214
 S-22100 Lund, Sweden    fax:    +46 46 108209
Newsgroups: soc.culture.nordic