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0 pointse-dard7y ago0 comments

I don't live in Sweden so I can't claim to be an expert (I like in the UK), but I find it highly unlikely that your claim of a 61% tax rate in Sweden is correct. It's likely the highest tax rate possible (in the UK that's 45%).

If you look at a tax calculator you will see that for a Swedish salary equivalent to $60K, the effective tax rate is actually ~27%.

$60K USD == ~540K SEK, which is 45K SEK a month.

Plugging 45,000 into [1] and choosing the municipality of Stockholm results in a net monthly income of 32,587 SEK.

That's a tax rate of ~27%...

https://statsskuld.se/en-sv/jobs/berakna-nettolon

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krunaldo7y ago

Well, first you have to calculate that the company pays 31.42% of your total salary in payroll taxes. This is illegal to print or show in any way or form to the employee from the employer.

Then on most goods there is a 25% tax, additional taxes other categories of goods such as gas, cars, alcohol and so forth.

So if the company pays you 60k SEK, you'll see ~45k on your payroll slip. The 61% percentage is the average total tax burden on a individual from all of these taxes.

tom_7y ago

Payroll tax is not your salary - it's tax on their employment of you, of an amount due that's proportional to your salary. It's the company's money, not yours.

(Would they pay you more if that tax wasn't due? Well, possibly, I suppose. Or they might just pay you the same, and then buy more stuff, employ more people, pay the company owners more money, that sort of thing.)

AdrianB17y ago

What are you smoking? Change it, it is bad for logic: any tax a company pays for you is from the money you bring in, not from the shareholders personal bank accounts. Nobody pays for the pleasure to have someone as an employee, but for the employee to deliver more than what is paid, otherwise you go under.

tom_7y ago

Reduce the payroll tax, and, what then? Same amount of money coming in, same going out on salaries, less going out on payroll tax. Now the business has options. It can buy more stuff; it can employ more people at similar salaries; it can give the owners more money.

But the argument being made appeared to be that it will give its existing employees pay rises, to each one in line with how much payroll tax it was paying for each of them previously - but this just strikes me as a bit unlikely.

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AdrianB17y ago

In Romania by law the company contribution was included in the payroll; there was no change in salaries, but people were finally able to see the total taxes they paid and calculate the percentage correctly: it was about double vs what they thought.

dagw7y ago

The 61% number in this case came from the top marginal tax rate on income in Sweden. The fact that it's roughly the same is payroll + income tax is a coincidence.

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krunaldo7y ago

Well, first you have to calculate that the company pays 31.42% of your total salary in payroll taxes. This is illegal to print or show in any way or form to the employee from the employer.

Then on most goods there is a 25% tax, additional taxes other categories of goods such as gas, cars, alcohol and so forth.

So if the company pays you 60k SEK, you'll see ~45k on your payroll slip. The 61% percentage is the average total tax burden on a individual from all of these taxes.

tom_7y ago

Payroll tax is not your salary - it's tax on their employment of you, of an amount due that's proportional to your salary. It's the company's money, not yours.

AdrianB17y ago

tom_7y ago

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AdrianB17y ago

dagw7y ago

The 61% number in this case came from the top marginal tax rate on income in Sweden. The fact that it's roughly the same is payroll + income tax is a coincidence.

j / k navigate · click thread line to collapse