Income inequality, blue states versus red states. WTF - I'm talking Gini Coefficients here!!!

[WTF]

Originally Posted by Jacuzzme

Plenty has to do with their economic policy, it’s called ‘tax the poor and middle class’. Try running for office on that platform in the US.

Actually more the middle class than poor!

You may want to read this link..

https://taxfoundation.org/scandinavi...es-taxes-2021/

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Insights into the Tax Systems of Scandinavian Countries
February 24, 2021


Elke Asen
Scandinavian countries are well-known for their broad social safety net and their public funding of services such as universal health care, higher education, parental leave, and child and elderly care. High levels of public spending naturally require high levels of taxation. In 2019, Denmark’s tax-to-GDP ratio was at 46.3 percent, Norway’s at 39.9 percent, and Sweden’s at 42.8 percent. This compares to a ratio of 24.5 percent in the United States.

So how do Scandinavian countries raise their tax revenues? A first breakdown shows that consumption taxes and social security contributions—both taxes with a very broad base—raise much of the additional revenue needed to fund their large-scale public programs.

Insights into the Tax Systems of Scandinavian Countries, How Scandinavian Countries Pay for their Government Spending, Sweden taxes, Norway taxes, Denmark taxes, US taxes tax-to-gdp ratio

Taxation of Labor Income
In 2019, Denmark (24.3 percent), Norway (21.0 percent), and Sweden (21.4 percent) all raised a high amount of tax revenue as a percent of GDP from individual taxes, almost exclusively through personal income taxes and social security contributions. This compares to 16.2 percent of GDP in individual taxes in the United States.

Tax Wedge
One way to analyze the level of taxation on wage income is to look at the so-called “tax wedge,” which shows the difference between an employer’s cost of an employee and the employee’s net disposable income.

In 2019, the tax wedge for a single worker with no children earning a nation’s average wage was 35.6 percent in Denmark, 35.7 percent in Norway, and 42.7 percent in Sweden. Although Denmark and Norway are below the OECD average of 36.0 percent, their tax wedges—as well as Sweden’s—are higher than the U.S. tax wedge of 29.8 percent.

Insights into the Tax Systems of Scandinavian Countries, How Scandinavian Countries Pay for their Government Spending, Sweden taxes, Norway taxes, Denmark taxes, US taxes tax wedget and tax burden

Social Security Contributions
Social security contributions are levied on wages to fund specific programs and confer an entitlement to receive a (contingent) future social benefit. Social security contributions are largely flat taxes and tend to be capped.

Both Norway and Sweden levy high social security contributions, raising revenue amounting to approximately 10 percent of GDP. In the United States, social security contributions (payroll taxes) raise revenue of about 6 percent of GDP.

In Norway and Sweden social security contributions—employer and employee side combined—account for 18.8 percent and 29.2 percent of total labor costs of a single worker with no children earning an average wage, respectively. This compares to 14.7 percent in the U.S.

Only Denmark does not impose social security contributions to fund its social programs. Instead, it uses a share of its individual income tax revenue for these programs.

Top Personal Income Taxes
Top personal income tax rates are rather high in Scandinavian countries, except in Norway. Denmark’s top statutory personal income tax rate is 55.9 percent, Norway’s is 38.2 percent, and Sweden’s is 57.2 percent.

Insights into the Tax Systems of Scandinavian Countries, How Scandinavian Countries Pay for their Government Spending, Sweden taxes, Norway taxes, Denmark taxes, US taxes top personal income tax rates

However, tax rates are not necessarily the most revealing feature of Scandinavian income tax systems. In fact, the United States’ top personal income tax rate is higher than Norway’s top rate, at 43.7 percent (federal and state combined).

Scandinavian countries tend to levy top personal income tax rates on (upper) middle-class earners, not just high-income taxpayers. For example, in Denmark the top statutory personal income tax rate of 55.9 percent applies to all income over 1.3 times the average income. From a U.S. perspective, this means that all income over $70,000 (1.3 times the average U.S. income of about $55,000) would be taxed at 55.9 percent.

Norway and Sweden have similarly flat income tax systems. Norway’s top personal tax rate of 38.2 percent applies to all income over 1.6 times the average Norwegian income. Sweden’s top personal tax rate of 57.2 percent applies to all income over 1.5 times the average national income.

In comparison, the United States levies its top personal income tax rate of 43.7 percent (federal and state combined) at 9.2 times the average U.S. income (at around $500,000). Thus, a comparatively smaller share of taxpayers faces the top rate.

Insights into Tax Systems of Scandinavian Countries, How Scandinavian Countries Pay for their Government Spending, Sweden taxes, Norway taxes, Denmark taxes, US taxes top personal income tax thresholds

Importantly, the overall progressivity of an income tax depends on the structure of all tax brackets, exemptions, and deductions, not only on the top rate and its threshold. In addition, the amount of tax revenue raised given a certain tax system depends on the distribution of taxable income.

Value-Added Taxes (VAT)
In addition to income taxes and social security contributions, all Scandinavian countries collect a significant amount of revenue from Value-Added Taxes (VATs). VATs are similar to sales taxes in that they aim to tax consumption. However, the VAT is assessed on the value added in each production stage of a good or service rather than only on the final sales price.

As a tax on consumption, VATs are economically efficient: they can raise significant revenue with relatively little harm to the economy. However, depending on the structure, a VAT can be a regressive tax because it falls more on those that consume a larger share of their income, which tend to be lower-income earners.

In 2019, Denmark collected about 9.4 percent of GDP through the VAT, Norway 8.6 percent, and Sweden 9.2 percent. All three countries have VAT rates of 25 percent. The United States does not have a national sales tax or VAT. Instead, there are state and local sales taxes. The average tax rate across the country (weighted by population) is about 7.4 percent. Due to the much lower rate, combined with a narrower base, U.S. sales taxes collect only about 2 percent of GDP in revenue.

Business Taxes
While Scandinavian countries raise significant amounts of tax revenue from individuals through the income tax, social security contributions, and the VAT, corporate income taxes—as in the United States—play a less important role in terms of revenue.

In 2019, the United States raised 1.0 percent of GDP from the corporate income tax, below the OECD average of 2.9 percent. Denmark and Sweden raised a share similar to the OECD average, at 3.0 percent and 2.9 percent of GDP, respectively. Norway is the exception with corporate revenue equal to 5.7 percent of GDP. Norway is situated on large reserves of oil and charges companies a corporate income tax rate of 78 percent on extractive activities.

All Scandinavian countries’ corporate income tax rates are lower than the United States’ rate. In 2020, both Denmark’s and Norway’s statutory corporate income tax rates were 22 percent and Sweden’s corporate income tax rate was 21.4 percent. The U.S. tax rate on corporations is slightly higher at 25.8 percent (federal and state combined).

Capital Gains and Dividend Taxes
The taxation of capital gains and dividends in Scandinavian countries is similar to the United States, with the exception of Denmark. Denmark’s top tax rate on dividends and capital gains is among the highest in the OECD, at 42 percent.

Norway’s (31.7 percent) and Sweden’s (30 percent) capital gains and dividends taxes are more in line with the United States. The United States taxes dividends and capital gains at 29.2 percent (federal and state combined).

Conclusion
Scandinavian countries provide a broader scope of public services—such as universal health care and higher education—than the United States. However, such programs necessitate higher levels of taxation, which is reflected in Scandinavia’s relatively high tax-to-GDP ratios.

Adopting such public services in the United States would naturally require higher levels of taxation. If the U.S. were to raise taxes in a way that mirrors Scandinavian countries, taxes—especially on the middle class—would increase through a new VAT and higher social security contributions. Business and capital taxes would not necessarily need to be increased if policymakers were following the Scandinavian model.




.

[The_Waco_Kid]

Originally Posted by WTF

New York and California pay more in federal taxes THAN THEY RECIEVE.

To Tiny's misguided point...have those blue states keep their money and give it to their poorer citizens to help Tiny out with his problem of income inequality in Blue states.

i'm going to say this one more time. you can paint this red/blue/blue/red any number of ways. it's partisan nonsense to do that, which makes perfect sense .. to you.

[Tiny]

Originally Posted by WTF

Actually more the middle class than poor!

You may want to read this link..

https://taxfoundation.org/scandinavi...es-taxes-2021/

Tax Foundation

Search...
FEDERAL TAXES

STATE TAXES

GLOBAL TAXES

BLOG
EDUCATION

PRINCIPLES
ABOUT US

Subscribe Donate
Facebook Logo

Twitter Logo

LinkedIn Logo

YouTube Logo

Instagram Logo

Podcast Logo
Insights into the Tax Systems of Scandinavian Countries
February 24, 2021


Elke Asen
Scandinavian countries are well-known for their broad social safety net and their public funding of services such as universal health care, higher education, parental leave, and child and elderly care. High levels of public spending naturally require high levels of taxation. In 2019, Denmark’s tax-to-GDP ratio was at 46.3 percent, Norway’s at 39.9 percent, and Sweden’s at 42.8 percent. This compares to a ratio of 24.5 percent in the United States.

So how do Scandinavian countries raise their tax revenues? A first breakdown shows that consumption taxes and social security contributions—both taxes with a very broad base—raise much of the additional revenue needed to fund their large-scale public programs.

Insights into the Tax Systems of Scandinavian Countries, How Scandinavian Countries Pay for their Government Spending, Sweden taxes, Norway taxes, Denmark taxes, US taxes tax-to-gdp ratio

Taxation of Labor Income
In 2019, Denmark (24.3 percent), Norway (21.0 percent), and Sweden (21.4 percent) all raised a high amount of tax revenue as a percent of GDP from individual taxes, almost exclusively through personal income taxes and social security contributions. This compares to 16.2 percent of GDP in individual taxes in the United States.

Tax Wedge
One way to analyze the level of taxation on wage income is to look at the so-called “tax wedge,” which shows the difference between an employer’s cost of an employee and the employee’s net disposable income.

In 2019, the tax wedge for a single worker with no children earning a nation’s average wage was 35.6 percent in Denmark, 35.7 percent in Norway, and 42.7 percent in Sweden. Although Denmark and Norway are below the OECD average of 36.0 percent, their tax wedges—as well as Sweden’s—are higher than the U.S. tax wedge of 29.8 percent.

Insights into the Tax Systems of Scandinavian Countries, How Scandinavian Countries Pay for their Government Spending, Sweden taxes, Norway taxes, Denmark taxes, US taxes tax wedget and tax burden

Social Security Contributions
Social security contributions are levied on wages to fund specific programs and confer an entitlement to receive a (contingent) future social benefit. Social security contributions are largely flat taxes and tend to be capped.

Both Norway and Sweden levy high social security contributions, raising revenue amounting to approximately 10 percent of GDP. In the United States, social security contributions (payroll taxes) raise revenue of about 6 percent of GDP.

In Norway and Sweden social security contributions—employer and employee side combined—account for 18.8 percent and 29.2 percent of total labor costs of a single worker with no children earning an average wage, respectively. This compares to 14.7 percent in the U.S.

Only Denmark does not impose social security contributions to fund its social programs. Instead, it uses a share of its individual income tax revenue for these programs.

Top Personal Income Taxes
Top personal income tax rates are rather high in Scandinavian countries, except in Norway. Denmark’s top statutory personal income tax rate is 55.9 percent, Norway’s is 38.2 percent, and Sweden’s is 57.2 percent.

Insights into the Tax Systems of Scandinavian Countries, How Scandinavian Countries Pay for their Government Spending, Sweden taxes, Norway taxes, Denmark taxes, US taxes top personal income tax rates

However, tax rates are not necessarily the most revealing feature of Scandinavian income tax systems. In fact, the United States’ top personal income tax rate is higher than Norway’s top rate, at 43.7 percent (federal and state combined).

Scandinavian countries tend to levy top personal income tax rates on (upper) middle-class earners, not just high-income taxpayers. For example, in Denmark the top statutory personal income tax rate of 55.9 percent applies to all income over 1.3 times the average income. From a U.S. perspective, this means that all income over $70,000 (1.3 times the average U.S. income of about $55,000) would be taxed at 55.9 percent.

Norway and Sweden have similarly flat income tax systems. Norway’s top personal tax rate of 38.2 percent applies to all income over 1.6 times the average Norwegian income. Sweden’s top personal tax rate of 57.2 percent applies to all income over 1.5 times the average national income.

In comparison, the United States levies its top personal income tax rate of 43.7 percent (federal and state combined) at 9.2 times the average U.S. income (at around $500,000). Thus, a comparatively smaller share of taxpayers faces the top rate.

Insights into Tax Systems of Scandinavian Countries, How Scandinavian Countries Pay for their Government Spending, Sweden taxes, Norway taxes, Denmark taxes, US taxes top personal income tax thresholds

Importantly, the overall progressivity of an income tax depends on the structure of all tax brackets, exemptions, and deductions, not only on the top rate and its threshold. In addition, the amount of tax revenue raised given a certain tax system depends on the distribution of taxable income.

Value-Added Taxes (VAT)
In addition to income taxes and social security contributions, all Scandinavian countries collect a significant amount of revenue from Value-Added Taxes (VATs). VATs are similar to sales taxes in that they aim to tax consumption. However, the VAT is assessed on the value added in each production stage of a good or service rather than only on the final sales price.

As a tax on consumption, VATs are economically efficient: they can raise significant revenue with relatively little harm to the economy. However, depending on the structure, a VAT can be a regressive tax because it falls more on those that consume a larger share of their income, which tend to be lower-income earners.

In 2019, Denmark collected about 9.4 percent of GDP through the VAT, Norway 8.6 percent, and Sweden 9.2 percent. All three countries have VAT rates of 25 percent. The United States does not have a national sales tax or VAT. Instead, there are state and local sales taxes. The average tax rate across the country (weighted by population) is about 7.4 percent. Due to the much lower rate, combined with a narrower base, U.S. sales taxes collect only about 2 percent of GDP in revenue.

Business Taxes
While Scandinavian countries raise significant amounts of tax revenue from individuals through the income tax, social security contributions, and the VAT, corporate income taxes—as in the United States—play a less important role in terms of revenue.

In 2019, the United States raised 1.0 percent of GDP from the corporate income tax, below the OECD average of 2.9 percent. Denmark and Sweden raised a share similar to the OECD average, at 3.0 percent and 2.9 percent of GDP, respectively. Norway is the exception with corporate revenue equal to 5.7 percent of GDP. Norway is situated on large reserves of oil and charges companies a corporate income tax rate of 78 percent on extractive activities.

All Scandinavian countries’ corporate income tax rates are lower than the United States’ rate. In 2020, both Denmark’s and Norway’s statutory corporate income tax rates were 22 percent and Sweden’s corporate income tax rate was 21.4 percent. The U.S. tax rate on corporations is slightly higher at 25.8 percent (federal and state combined).

Capital Gains and Dividend Taxes
The taxation of capital gains and dividends in Scandinavian countries is similar to the United States, with the exception of Denmark. Denmark’s top tax rate on dividends and capital gains is among the highest in the OECD, at 42 percent.

Norway’s (31.7 percent) and Sweden’s (30 percent) capital gains and dividends taxes are more in line with the United States. The United States taxes dividends and capital gains at 29.2 percent (federal and state combined).

Conclusion
Scandinavian countries provide a broader scope of public services—such as universal health care and higher education—than the United States. However, such programs necessitate higher levels of taxation, which is reflected in Scandinavia’s relatively high tax-to-GDP ratios.

Adopting such public services in the United States would naturally require higher levels of taxation. If the U.S. were to raise taxes in a way that mirrors Scandinavian countries, taxes—especially on the middle class—would increase through a new VAT and higher social security contributions. Business and capital taxes would not necessarily need to be increased if policymakers were following the Scandinavian model.




.

So you agree with Jacuzzme? The VAT is a bigger burden on the poor, in terms of % of income, than it is on the middle class.

Good link by the way. Every Democrat should read it. You'll never be able to pay for a proper welfare state just by taxing the top 1%.

[Tiny]

Originally Posted by WTF

New York and California pay more in federal taxes THAN THEY RECIEVE.

Of course they do. You pay your federal taxes, the politicians in Washington waste a big part, and then they send some back to the states and localities.

What does that have to do with income inequality, which is usually calculated on a "before income tax basis," so that Gini Coefficient Lovers can make the USA appear more unequal than it really is?

[Lucas McCain]

Who even cares? In my world, you work hard you make more money than those who don't. If I'm smarter and more educated than you and there is no way in hell that you could do my job, but I could easily do your job, we should be compensated accordingly based on what the market decides our skillsets are worth.

Fuck income equality for all. I believe in gender and race equality as far as income and that's it. But if I am highly skilled in a certain field and you are not, you deserve your check and I deserve mine. If one decides to take a job that a robot could do, that's called a you problem and you should have picked something else for a career.

It's not the government's job to figure out how to make the income gap more equitable. It's up to individuals to get off their lazy asses and do it for themselves IMO.

[Tiny]

Originally Posted by WTF

To Tiny's misguided point...have those blue states keep their money and give it to their poorer citizens to help Tiny out with his problem of income inequality in Blue states.

I don't care what blue states do. But yes, let Texans keep more of their money. Exercise the power of the purse and administer social programs closest to the people affected. Cut out the Feds where it makes sense to do so.

[Tiny]

Originally Posted by Jacuzzme

Plenty has to do with their economic policy, it’s called ‘tax the poor and middle class’. Try running for office on that platform in the US.

Agreed. If Progressives get their way, the country will go bankrupt, because the people aren't going to vote for candidates who want to raise their taxes.

[WTF]

Originally Posted by The_Waco_Kid

i'm going to say this one more time. you can paint this red/blue/blue/red any number of ways. it's partisan nonsense to do that, which makes perfect sense .. to you.

You can say the exact same thing about the OP.

[WTF]

Originally Posted by Tiny

Agreed. If Progressives get their way, the country will go bankrupt, because the people aren't going to vote for candidates who want to raise their taxes.

Please show me where so called conseratives have done anything to curb our deficits and debt the last 43 years!

[The_Waco_Kid]

Originally Posted by WTF

You can say the exact same thing about the OP.

tiny is just showing that the numbers can be interpreted many ways and that it's not a cut and dried "blue paying for red" issue which you fixate on.

Originally Posted by WTF

Please show me where so called conseratives have done anything to curb our deficits and debt the last 43 years!

show me what the liberals have done.



10 Absurdly Wasteful Items Tucked Into Democrats’ $3.5 Trillion Tax-and-Spend Monstrosity

https://www.heritage.org/budget-and-...illion-tax-and




butt it's Ronnie's fault, right?

[dilbert firestorm]

so tiny in love with this babe Gini!

she must be very shapely to have tiny very captivated.

[WTF]

Originally Posted by Tiny

So you agree with Jacuzzme? The VAT is a bigger burden on the poor, in terms of % of income, than it is on the middle class.

.

Every regressive tax is a bigger burden on the poor than the middle class or rich.

But what I said or linked was that Scandinavian model is paid for by the middle class.

Which is why the Reagan SS tax increase led to the distorted view in the late 90's of yearly deficits. ( It made them appear smaller if you're having trouble seeing where I'm going with this and was basically a huge tax on the poor and middle class after earliercuttingthe taxes on high earners)

You keep this up and you may actually grasp how these politicians smoke and mirror you to death to worship at the feet of the President who started all this "debt does not matter" horseshit!

Originally Posted by Tiny

.

Good link by the way. Every Democrat should read it. You'll never be able to pay for a proper welfare state just by taxing the top 1%.

Which does not mean they should not be taxed!

Every Republican should read it to see how the so called welfare state can actually be paid for.

How the fuck do you think we paid for Medicare from 1986 on? (See above)

Let me give you a hint...the Reagan tax hike!

Why do you think I keep saying we will raise the SS and Medicare tax again in the 2030's?

You eventually get there Tiny....especially if you take off that Ronnie t-shirt !

TWK...please refrain from commenting and embarrassing yourself. Stick to your brilliant Money Manger advice concerning IBM!!!!

[Tiny]

Originally Posted by dilbert firestorm

so tiny in love with this babe Gini!

she must be very shapely to have tiny very captivated.

Don’t be silly Dilbert. You can’t fuck a Gini Coefficient

[Tiny]

Originally Posted by The_Waco_Kid

10 Absurdly Wasteful Items Tucked Into Democrats’ $3.5 Trillion Tax-and-Spend Monstrosity

https://www.heritage.org/budget-and-...illion-tax-and




butt it's Ronnie's fault, right?

Waco Kid, this was your reply to WTF who said conservatives are as bad as progressives at running up debt.

Well, Biden’s Progressive Lite. Sanders, the Chairman of the Senate Finance Committee started out with a 6.5 trillion Build Back Better Bill. And he and AOC and other progressives viewed that as a small down payment on a huge Green New Deal, to pay not only for a carbonless economy but also for social goals. Cost estimates for that ranged up to 93 trillion.

And how would we pay for that? We wouldn’t have. Because money grows on trees. Using the principles of modern monetary theory we just borrow the money. Yeah we tax the wealthy too, obstensibly to control inflation, but in reality because Progressives want to steal everything they can from people who have more than they do. You can see this in Sanders and Warrens tax plans that they were running on in 2020. Their respective proposed wealth taxes would have kicked in at about 3 or 4 times their net wealth. I guess each wanted to leave a margin of safety in case they added to their wealth.

And yes, in WTF’s mind, debt run up by a Republican is evil incarnate, while debt run up by Democrats is all hunky dory. And since Progressives are Democrats you won’t hear a peep out of him. Considering how doing away with fossil fuels is part of their master plan, I just don’t understand why WTF thinks the way he does. He’s heavily invested in oil and gas midstream. I love that guy, in a Christian sense, and just wish he’d get over his Stockholm Syndrome

[WTF]

Originally Posted by The_Waco_Kid

tiny is just showing that the numbers can be interpreted many ways and that it's not a cut and dried "blue paying for red" issue which you fixate on.














butt it's Ronnie's fault, right?

I'm not fixated on it, I didn't start the damn thread. I actually understand that it is not cut and dried.

What I said (and have proven time and time again) is that Ronnie started this theme about debt not mattering. Since he promoted this supply side bullshit that Bush correctly called Voodoo economics, our debt to gdp has risen exponentially!

Ronnie started that. I never said he was responsible for George Bush, Obama , Trumps or Biden's huge deficits.....but they are doing exactly as Ronnie did.

Your problem seems to be not being able to comprehend what it is I have actually written.

Some call that information bias. I call it something else