When we lived in Cal decades ago, taxes weren't all that much lower. Federal taxes and state taxes (higher) on a larger salary, lots of social security and other fiddly little taxes and 100-200/check for 20% of my health insurance. The only good thing about social security is that while you pay a more the benefits are larger 62+. I'm trying to remember, but like 25% for the feds, 8-10% for the state, 6% for social security and the health insurance. Call it high 40's or so, maybe 50%? Yeah, sales tax was lower vs. vat but I thought Cal had about the highest sales tax in the states?
It all depends on what the aggregate deductions that are outside your control sum to, and what you get for the money.
In Ontario, it would be about 38%, and that’d include healthcare. Canada is very efficient though. At least a decade ago, Canada’s non-defense spending per person was less than the US’s.
In Germany it would be about 44% total. Of course, in Germany, $200k is a top 2% income. In California it’s only a top 8% income.
That's what's directly taken out of your check right? But how much more do you pay after that in other taxes? And if you go even further, how much higher are the prices of everything that you purchase due to the various taxes involved in their production?
Does your Germany figure include healthcare and church tax? That could push it over 50%. Though church tax is optional and you can go private for healthcare.
Yes. Apart from the countries which live off of foreign direct investment, taxes are generally pretty high.
Also, in many EU states, companies contribute to social security. In some this is indexed to profits, but on others this is indexed directly to wages, so if you count that bit, taxes directly attributable to your income can easily exceed 60% of what a company pays out.
I don't know if Belgium is using that loophole when counting the 60%, though.
>Apart from the countries which live off of foreign direct investment, taxes are generally pretty high.
I have no idea about this. Can you explain what you mean and give some examples of such countries ?
>Also, in many EU states, companies contribute to social security. In some this is indexed to profits, but on others this is indexed into wages, so if you count that bit, taxes directly attributable to your income can easily exceed 60% of what a company pays out.
True. Some EU countries also tax the gross salary the employer has to give you before it gets to you, which is in bad faith not included in payslips. So when you negotiate your 60k gross wage, it's actually costing your employer something like 72k Euros. I hate this shady practice.
Their inward FDI stock to GDP ratio is around 250%, which is about 4× the EU average; and Ireland does this with a decently sized economy.
And then there's Luxembourg (1400%) and Malta (2000%) which arguably do much “worse” but are comparatively tiny.
I didn't do the math for every EU country. Those were just some of the few that came to mind. For instance, Cyprus has similar values to Ireland, but the Irish economy is 15× bigger.
When there's a lot of foreign money going through your economy and you can tax it to moderate amounts, you get to offer lower rates to your own citizens.
Which is great, but obviously doesn't scale if every country tries to do the same.
> I have no idea about this. Can you explain what you mean and give some examples of such countries ?
Probably countries like Ireland, Montenegro, Belize, etc which act as tax havens for foreign corporations. Or Singapore, while also a tax haven, acts as a center for regional trade.
They could also mean resource rich countries that sell mineral rights to foreign corporations, who made investments in infrastructure in order to facilitate their operations, and they pay back dividends to the state, which offset the tax burden of the local population.
If an American factored in the totality of their tax burden, it would be pretty high. The USA has the benefit of higher incomes and a gigantic population, so there's some economies of scale. But even so, add up all of income tax (federal, state, city, county), sales taxes, property taxes, tariffs, tolls, etc and the % is already pretty high. After factoring the cost of benefits that are free/subsidized in other countries, and the cost probably averages out to the same.
Of course, European countries can also have those same consumption taxes. But I'm not sure if OP factored that in.
> sales taxes, property taxes, tariffs, tolls, etc and the % is already pretty high.
These taxes you mentioned (ignoring income taxes) are even higher in many EU countries than the US, especially sales tax. Same for tolls, tariffs, etc. they're all higher here and they're increasing them and adding new taxes on top, because EU coffers are being bled dry right now with the economy, trade wars, and actual wars going on.
Also, commodity products and services are generally more expensive here than in the US too. Like, I see on youtube the hobby stuff Americans do in their garage with home labs, electronic measuring equipment, power tools and stuff, all gotten nearly for free on craigslist, but if I want to replicate their setups it would cost way more here(from a smaller wage too), not to mention buying a house with a garage in Europe is very much of out of budget to most working class in Europe to begin with.
All this stuff being so cheap and readily available is probably why Americans in their garages have been so much more inventive and entrepreneurial than Europeans.
>After factoring the cost of benefits that are free/subsidized in other countries, and the cost probably averages out to the same.
True, but a lot of free stuff you get back from the government is sometimes of low quality compared to what you pay for in taxes on a high income, due to never being enough money for everything everyone needs, and not being able to attract and keep qualified and motivated workers to stay in the public system when they can earn more privately, and it's only been getting worse and worse since Covid and Ukraine, with no signs of improving.
For example, I am now paying ~1000 Euros for private physiotherapy after my accident, since the free government one is abysmal, which I am forced to pay for anyway out of my salary even though it's useless.
Another example, after my jaw surgery at the public hospital here they just strap cold packs to your face like in WW2, while in the US, my ex-boss who went through a similar procedure at a hospital there they had specialized head cooling devices for your post-op recovery, instead of medieval ice packs, while also being free of charge from his employer insurance. So you might pay more in the US for health insurance, but you also get more in return.
Overall I think I'd still prefer living here than in the US, but there's valid reasons why immigration to the US, and especially the success of immigrants there from an integration and financial perspective, is so high compared to here despite all the issues the US has.
In Brussels? Over half your net income would go to rent. If you are frugal then maybe you can get it to work out. This is not the type of income where you eat out every week.
providing healthcare and education are costs easily overlooked by most americans. But the reality is, these are costs borne by americans as well. and likely at a higher rate: americans pay more per capitia on both of those versus most other nations.
The top marginal tax rate in 2024 (assessed 2025) was 50%. But that's not the total tax take - that's the marginal rate of tax for income above 48320 euro.
