View Full Version : Tax systems in various countries:


Mallipeep
Apr 27, 2012, 12:25 PM
Im interested in tax systems in various countries.

In my country (Estonia) when employee pays 3000€, the goverment deducts following:
Social security (company) : 736.61€, 24.55%
Unemployment insurance ( company) : 31.25€, 1.04%
Pension fund ( employee) : 44.64€, 1.49%
Unenployment insurance ( employee) : 62.5€, 2.08%
Income tax ( employee) : 416.01, 13.87%

Total money received: 1708.99€ , or 56.97%

My country has flat tax, but "social security insurance" has no cap - hence when compared to germany (progressive tax, but social security insurance cap) - it often balances the total tax burden out at most income levels.

There are two sides in our politics, one who is pushing progressive tax in addition to non-capped social-security-insurance and another who wants to add the social-security-insurance cap without progressive tax - both of these seems excessive to me.

So since i have decent knowledge of only two tax systems ( Estonia & Germany ) i'd like to know about more countries - does every country with progressive income tax also have social-insurance cap - or are there countries with both flat-tax + social-insurance-cap / progressive-tax + no-social-insurance cap.

edit to elaborate on main exemptions in response to second post:
---
In addition there is 20% VAT/sales tax + lot of high ( 50-150% range) taxes on tobacco/gas/alcohol
no VAT exemption for basic foodstuffs/supplies like in many european countries
pension/social-security becomes available at about 65 year old
job-specific exemptions: eligible for pension at earlier age ( 5x-ish) for policemen/firemen and similar jobs
re-invested corporate capital has no income tax, as long as you invest all the money in this country.
- exemption here - a corporation can invest in foreign country tax-free as long as the sum does not exceed what the corporation has invested here initially ( so if you invested 100000€ in estonia, you can re-invest 100.000€ tax-free elsewhere, but no more

peter grimes
Apr 27, 2012, 12:31 PM
Interesting thread.

Couple of questions:
-do you have any local taxes?
-are there VAT or sales tax?
-at what age can the employee begin to draw a pension or social security?
-are there types of jobs exempt from these rules?

I live in USA, but I'll let someone more knowledgeable explain our tax system.

Monsterzuma
Apr 27, 2012, 12:33 PM
The allegedly ~50% tax rate on wage labor in Latvia is something i've heard Michael Hudson clamor about for years.

Takhisis
Apr 27, 2012, 04:40 PM
Here in Argentina, VAT is 21% for most stuff, and 27% for some industries, IIBB (Ingresos Brutos - net income) is 2%, Ganancias (Income Tax) is on a scale that is changed by the government all the time.

Export duties for the farmers are 35%, plus the 2% IIBB and 21% VAT, and if anything's left over they apply the Income tax.
Strikingly, the great mining companies (like, say, Barrick Gold) pay less than 5% overall thanks to special tax exemptions.

Arwon
Apr 27, 2012, 05:53 PM
In Australia I don't think we have a "social security insurance" thing, specificially. Welfare payments including pensions just come out of general revenue, although there is a 1% levy for Medicare, not that it covers all health costs.

For social security, as well as means-tested pensions from general revenue, we have compulsory saving system called superannuation. Employers must contribute at least 9% (I get 15%) on top of your gross pay into a superannuation fund which accumulates and you can't access until you retire.

Overall tax burden is around 30% of GDP.

As far as progressive income tax rates go, the first $6000 are tax-free then it's 15% until $37000. The top tax rate of 45% kicks in on income over $180 000 a year. The tax-free income threshold will rise from $6000 to $18000 next year as part of the carbon price compensation package.

Additionally student debt is done through the tax system. I pay about 6% of my total taxable income back, through the tax system, as an interest-free repayment on my university debt. Those repayments kick in around $49000 at 4%, and can go up to 8% for higher earners.