Saw an interesting graphic in the Economist depicting the approximate amount of taxes (net of offsets) governments around the world collect on $100,000; about the middle class average income level in developed countries. This is compared to the amount of social security (or safety net) the government provides to its workers. The logical argument for higher taxes would be justified by a higher percentage of social security, as is the case in Europe which has higher taxes but more social welfare programs for its citizens. Unfortunately this is not the case in many developing, socialist leaning, countries like India, Mexico and Turkey, where $100,000 puts you firmly in the “wealthy” class, who are taxed much more heavily with relatively lower levels of employee social security.
With the bush tax cuts expiring in 2011, and higher taxes on the horizon, this topic is of particular concern domestically. But the good news is that America is still one of the lowest taxing countries for this level of income, while still providing a decent safety net to its citizens. If you make more than $100,000 just be thankful that you don’t live in Pakistan! Alternatively if you don’t want to rely on the government at all and pay no taxes on your fortune, then Bahama is the place for you.
2 thoughts on “Taxes and Social Security on $100,000 Around The World”
Looks like the numbers above may include some factor for the state and local taxes. Around 15% for married joint + a child would include Fed + State (in CA).
This report does fail to mention that most tax credits available start to fall off at $110k in the US, so the rise in tax will be exponential just above $100k until it plateaus at 35% (w/ Bush cuts). Other countries in the report have probably already hit a similar acceleration due to standard of living vs wage differences. So I think this is really an apples to oranges comparison.
What about all the other taxes we pay in America that these other countries don’t pay – State tax, County tax, Sales tax, Bailing out our bankers tax……
Bahama’s is the place to go. No govt and sunshine all day long.