Originally posted by TOC:
I must protest against what Roger said that Swedes pay two thirds of their income in tax. That is simply not true of the average citizen at all. It is true, nevertheless, that the taxes we pay are defintely among the highest in the world.
You misquoted me. I said the average Swede pays 2/3 of their income in taxes in combined income AND VAT. The VAT alone is 25%. Sorry if the wording was confusing. That is an insane amount of tax to pay for "FREE" services. Like I said, there's no such thing as free. Swedes pay an enormous amount to get these free services. K-12 schools here are "free" as well, paid through huge taxes, bond issues (eventually paid by taxes), and other large taxes tacked onto our property taxes. When I lived in San Diego, the education taxes paid on my property taxes were actually higher than the property taxes by themselves. Anytime someone offers you something for free, hold onto your wallet with both hands.
Taxes make up 50% of the GDP of Sweden. Payroll taxes as of 2006 averaged 40% plus an additional 25% VAT, the highest in Europe.
Note, I'm not even including the 32% paid by employers as part of the employee compensation that employees don't see on their income tax returns. Don't be fooled that the company pays it. Since it's based on an employee's gross wages, it's part of the employee's tax. The only difference is that the employer handles all the paperwork and signs over the check.
In the US, the equivalent is the employer paid portion of Social Security and Medicare which adds up to an additional 7.65% on top of the 7.65% paid directly by the employee.
I've always said that income tax withholding should be outlawed and every taxpayer should be forced to write a monthly check to the government for their taxes. I think if that were to ever happen, you'd have a tax revolution in every industrialized nation in the world as people finally realized just how much they're paying. Just like Las Vegas makes you use chips rather than money, withholding is a way to abstract how much money you're actually dealing with, making it seem unreal somehow. Since you never actually see the money, somehow it doesn't feel like you're paying all that much.
Sweden is a lovely place to visit, which I go to every year including this July, but I wouldn't want to live there.
I should say, before anybody jumps on me for that last statement, that I love Sweden. The people are the nicest in the world and the climate is lovely. My wife and I even built a little one-room house with loft for the kids on my mother-in-law's property as a place for us to stay.
