Euro's Please Verify

[Roamy]

is this sh!t true???


Current European Tax rates. (VAT = National Sale tax)

United Kingdom
Income Tax: 50%
VAT: 17.5% TOTAL: 67.5%

Germany
Income Tax: 45%
VAT: 19% TOTAL: 64%

France
Income Tax: 40%
VAT: 19.6% TOTAL: 59.6%

Greece
Income Tax: 40%
VAT: 25% TOTAL: 65%

Spain
Income Tax: 45%
VAT: 16% TOTAL: 61%

Portugal
Income Tax: 42%
VAT: 20% TOTAL: 62%

Sweden
Income Tax: 55%
VAT: 25% TOTAL: 80%

Norway
Income Tax: 54.3%
VAT: 25% TOTAL: 79.3%

Netherlands
Income Tax: 52%
VAT: 19% TOTAL: 71%

Denmark
Income Tax: 58%
VAT: 25% TOTAL: 83%

Finland
Income Tax: 53%
VAT: 22% TOTAL: 75%


If you’ve started to wonder what the real costs of “socialism” are going to be, once the full program in these United States hits your wallet, take a look at the table. As you digest these mind-boggling figures, keep in mind that in spite of these astronomical tax rates, these countries are still not financing their social welfare programs exclusively from tax revenues! They are deeply mired in public debt of gargantuan proportions. Greece has reached the point where its debt is so huge it is in imminent danger of defaulting. That is the reason the European economic community has intervened to bail them out. If you’re following the financial news, you know Spain and Portugal are right behind Greece .

[Rollo]

Looks like someone got an email again.
http://marinevetviewsonamerica.blogspot.com/2010/05/this-is-scarier-than-obamacare.html
This time it's only taken 2 months to find out friend though. (I knew that he wasn't capable of writing such a thing).

The rates are correct however, they are what's known as "Marginal Tax Rates"
http://www.hmrc.gov.uk/rates/it.htm
For the UK, the 50% tax bracket doesn't apply until you earn at least £150,000, and even then the 50% rate only applies on every pound IN EXCESS of £150,000.
So only the 150,001st pound gets taxed at 50%.

http://www.irs.gov/newsroom/article/0,,id=187825,00.html
Equally in the United States the highest marginal tax rate is 35% paid IN EXCESS of every dollar over $372,951, but the US also has separate state taxes and sales taxes.

Also, if you add in state taxes:
http://www.ftb.ca.gov/forms/2009_California_Tax_Rates_and_Exemptions.shtml
For example California, then the highest marginal rate for individuals is 9.55%

If you then add in either City or Country taxes which are also about 9% (this varies from county to county and city to city) then...

35% US Fed
9.55% CA State
9.75 % LA County
Then you end up with... 54.3% :eek:

I refer you to the famous racial discrimination case of Pot vs Kettle.

[Rollo]

People generally in the United States have never paid enough Income Tax. For goodness sake, the country was started over a taxation dispute.

When the original debt of $75,000,000 was assumed by the US Treasury, they had to issue bills and Treasury Bonds to finance the debt. That $75,000,000 has never been paid back and now stands proudly with additions at about US $13 trillion.


They are deeply mired in public debt of gargantuan proportions.

Please remove the 60 foot telegraph pole from your own eye.

[Eki]

is this sh!t true???


Current European Tax rates. (VAT = National Sale tax)

United Kingdom
Income Tax: 50%
VAT: 17.5% TOTAL: 67.5%

Germany
Income Tax: 45%
VAT: 19% TOTAL: 64%

France
Income Tax: 40%
VAT: 19.6% TOTAL: 59.6%

Greece
Income Tax: 40%
VAT: 25% TOTAL: 65%

Spain
Income Tax: 45%
VAT: 16% TOTAL: 61%

Portugal
Income Tax: 42%
VAT: 20% TOTAL: 62%

Sweden
Income Tax: 55%
VAT: 25% TOTAL: 80%

Norway
Income Tax: 54.3%
VAT: 25% TOTAL: 79.3%

Netherlands
Income Tax: 52%
VAT: 19% TOTAL: 71%

Denmark
Income Tax: 58%
VAT: 25% TOTAL: 83%

Finland
Income Tax: 53%
VAT: 22% TOTAL: 75%


If you’ve started to wonder what the real costs of “socialism” are going to be, once the full program in these United States hits your wallet, take a look at the table. As you digest these mind-boggling figures, keep in mind that in spite of these astronomical tax rates, these countries are still not financing their social welfare programs exclusively from tax revenues! They are deeply mired in public debt of gargantuan proportions. Greece has reached the point where its debt is so huge it is in imminent danger of defaulting. That is the reason the European economic community has intervened to bail them out. If you’re following the financial news, you know Spain and Portugal are right behind Greece .
Funnily, Greece, Spain and Portugal are among the lowest total tax rates in your list (65% or less). Clearly they haven't paid enough taxes and that's why their economy is a mess.

[Francis44]

Funnily, Greece, Spain and Portugal are among the lowest total tax rates in your list (65% or less). Clearly they haven't paid enough taxes and that's why their economy is a mess.

Are you sure about that?!

Portuguese people are some of the most taxed in Europe, in public service, state employes get well over 30% of their salary cut off by taxes, and then there are all those other taxes. And employes here receive much less than others public employes.

So you get an ideia, a VW Passat is well around 37000 euros here, how much it costs there in Finland?!

I know some people from other countries and the portuguese people pay well over some other Europe countrys.

This ideia about Europe was great back in the day, the problem is the European governators have no fix for this, they thought they could have a competitve Europe against China and etc.
Well they failed miserably and now this is whats happened, funny enough Portugal didn't have as much deficit when they entered the Euro, so go figure it out.

And our VAT is already 21%.

[Mark]

is
United Kingdom
Income Tax: 50%
VAT: 17.5% TOTAL: 67.5%


VAT: 17.5% on most products until the end of the year. It's going up to 20% in January. This is levelled on the entire cost of a purchase. However 'essentials' such as food do not attract any VAT.

Income tax, no, 50% is way wrong!
It's much more complicated than that.
It goes in bands and the tax is charged on the money in that band, not on the total amount.

The current 'personal allowance' is £6,475 is not taxed at all.
The next £34,800 is taxed at 20%
You have to earn over £150,000 + personal allowance = £156,475 to attract the 50% rate and that only applies to earnings over that amount, not the entire amount.

So. If you have someone earning £30,000 then you have to remove the personal allowance giving £23,525 then this is taxed at 20% giving a tax bill of £4,705 for the year. Giving a tax rate for an average person of 15.6%, rather less than you imply!

This of course ignores national insurance, which is notionally 11% but don't ask me what of!

[Mark]

Portuguese people are some of the most taxed in Europe, in public service, state employes get well over 30% of their salary cut off by taxes, and then there are all those other taxes. And employes here receive much less than others public employes..


Are you sure about that? I thought the likes of Denmark, Sweden, Norway carried the highest tax burden? But then they have public services to match.

[Brown, Jon Brow]

is this sh!t true???


Current European Tax rates. (VAT = National Sale tax)

United Kingdom
Income Tax: 50%
VAT: 17.5% TOTAL: 67.5%



No this is completely wrong as explained by Mark above.

Why have you added VAT to income tax? They are completely unrelated.

[Mark]

Why have you added VAT to income tax? They are completely unrelated.

Because VAT is paid out of your net income, but either way, it's quite misleading, especially as not all items are fully VAT rated.

[Francis44]

Are you sure about that? I thought the likes of Denmark, Sweden, Norway carried the highest tax burden? But then they have public services to match.

We have public services aswell, but comparing to the countrys you refered to, they have much higher salaries then people in Portugal, the taxes they ask us to pay here are too much, but then again it's a sacrifice we have to endure and people here understands this, perhaps some other countrys dont since all they do is riots and protests with violence.

Then there is gas for example, Government over here has a ridiculious high tax over it, some people close to the border go fill their tank in Spain because they can save alot of money.
Government also has a ridiculious tax over news cars sales, over here some cars cost well over 10 000 more in comparation with other European countrys.

The taxes over salary's and small products is high but understandable, but it's with all those other stupid taxes they take all the money away from people.

And they're dumb aswell, lack of money is a big problem, but they wanted to build new bridges and TGV. What the hell is this?! I dont want my kids, grandsons and future generations to pay for a ridiculious expensive train line, if they had money I was okay with it, but right now it's not the priority.

[Dave B]

is this sh!t true???
As others have pointed out, it's full of inaccuracies and assumptions.

If I wanted to lob a grenade into this thread, I could always point out that the US taxpayer also has the massive financial burden of providing for their own private healthcare, but that's been debated to death.... :grenade:

[Mark]

Then there is gas for example, Government over here has a ridiculious high tax over it, some people close to the border go fill their tank in Spain because they can save alot of money.

I assume you mean petrol and not the gas you use to heat hot water and cook your dinner?!

Portugal's price for petrol is roughly the same as we're paying in the UK 116p, maybe a couple of pence more. However the Diesel price is very different, 95p as compared to 117p here.

But then you look at the United States and see that petrol is 48p per litre there :eek:

[Francis44]

I assume you mean petrol and not the gas you use to heat hot water and cook your dinner?!

Portugal's price for petrol is roughly the same as we're paying in the UK 116p, maybe a couple of pence more. However the Diesel price is very different, 95p as compared to 117p here.

But then you look at the United States and see that petrol is 48p per litre there :eek:

Yes Im talking about petrol :p :.....

Well US has petrol cheaper seeing their cars consume well over 15 litros per kilometre.

European cars are much more economical.

And I see you guys have expensive petrol too, well, I've been to other Europe countrys and they have much cheaper prices.

[chuck34]

People generally in the United States have never paid enough Income Tax. For goodness sake, the country was started over a taxation dispute.

When the original debt of $75,000,000 was assumed by the US Treasury, they had to issue bills and Treasury Bonds to finance the debt. That $75,000,000 has never been paid back and now stands proudly with additions at about US $13 trillion.



Please remove the 60 foot telegraph pole from your own eye.

That is completely false. The new Federal Governent assumed all State debts after the ratification of the Constitution. It took a while to pay off, but it was done. Ironically by Andrew Jackson, the founder of the Democratic Party.

http://online.wsj.com/article/SB123491373049303821.html

[Roamy]

Francis44
Was life in Portugal better before joining the EU or after.?

So a poor bloke making 60K a year in London could have a rough go of it?

[Francis44]

Francis44
Was life in Portugal better before joining the EU or after.?

So a poor bloke making 60K a year in London could have a rough go of it?

Perhaps it wasn't better, but surely cheaper.

Europe for sure helped all smaller countries like Portugal and so on, but at the same time the risks involved when a country joins are big.

Then there is hipocracy in Europe, which I hate. For example, the Portuguese government used it's power in a company called PT to stop them selling Vivo from Brasil to Telefonica, and now a spanish ministre was outraged be this, but he guess we forgot that 6 monts ago their government did the same thingh when a French company tryed to buy a spanish gas company.

This is why this Europe thing isn't working, small countries try to earn money and the bigger ones screw their business again and again.

[Mark]

So a poor bloke making 60K a year in London could have a rough go of it?

If you are making £60,000 a year. Then thats £53,525 of taxable income
34800 at 20% = 6,690
18725 at 40% = 7,940
Giving total tax = £14,630
Giving a rate of 27% over the whole amount.

[Roamy]

Perhaps it wasn't better, but surely cheaper.

Europe for sure helped all smaller countries like Portugal and so on, but at the same time the risks involved when a country joins are big.

Then there is hipocracy in Europe, which I hate. For example, the Portuguese government used it's power in a company called PT to stop them selling Vivo from Brasil to Telefonica, and now a spanish ministre was outraged be this, but he guess we forgot that 6 monts ago their government did the same thingh when a French company tryed to buy a spanish gas company.

This is why this Europe thing isn't working, small countries try to earn money and the bigger ones screw their business again and again.

so given the choice would you resign from the EU or continue on?

[Roamy]

If you are making £60,000 a year. Then thats £53,525 of taxable income
34800 at 20% = 6,690
18725 at 40% = 7,940
Giving total tax = £14,630
Giving a rate of 27% over the whole amount.

So then you add other taxes VAT and so on - correct??

How much is a average house in London? Lets say in a working class area.

[Brown, Jon Brow]

So then you add other taxes VAT and so on - correct??

How much is a average house in London? Lets say in a working class area.

In London you are looking at around £400,000 for a house :s

[Mark]

So then you add other taxes VAT and so on - correct??

Yep. Same as sales tax in the USA.



How much is a average house in London? Lets say in a working class area.

London is freaky and totally unrepresentitive of the UK at large. You'll get a better and more accurate picture of the real UK by ignoring London!

Where I live is a suburb of Newcastle (approx. 8 miles out of the centre) and I have a 3 bed terraced house and it cost me £95,000 last year. For a better standard e.g. a semi-detached with off road parking and gardens front and rear you're talking more like £150,000 upwards.

[Jag_Warrior]

Is the tax system in the UK loaded with deductions? I mean, are you able to deduct things like mortgage interest, retirement contributions, etc. from your gross income?

And speaking of mortgage interest, I heard on Bloomberg that the 30 year fixed rate mortgage is rather unique to the U.S. So how do the mortgages work in the UK and the rest of Europe? Typically we'd make a 10% down payment and finance the balance on a fully amortized, fixed rate mortgage over a 30 year term. Is the difference in the term (30 years, and even 40 years during the housing boom) or the fixed rate... is the typical mortgage there a variable rate?

Oh, and one last question (well, probably not), but I see that the VAT does not apply to food, is that right? In my area, we have a food/restaurant tax ON TOP OF the regular sales tax. Each state and locality here is different when it comes to taxes.

[GridGirl]

Pension deductions are tax deductable.

Mortgage terms are usually taken over 25 or 30 years but may be shorter if you are older. Most lenders won't lend on a term which takes you over retirement age which is typically 65.

As for rate terms the world is your oyster so to speak. The larger the deposit the lower rate you can borrow at. You can also fix your deals to over short, medium or long term. Short term is around 2 years, medium is around 4 years and long term is about 7 years. Loans often change to a tracker rate
when the fixed deal ends. This is great rut now with at base rate at 0.5% as a tracker rate may be around 2% above the base rate. In times of higher rates I is probably more prudent to fix your interest rate.

Before the credit crunch you could take out 100% mortgages. Typically all lenders now require at least a 10% deposit. Although there are some product for people who previosuly took out 100% mortgages or have negative equity.

VAT is payable on some foods and not others. You wouldn't pay VAT on fruit and vegetables but you would on pay VAT on confectionary. There was a famous VAT case in the courts over something like Jaffa cakes if I remember rightly. The debate hinged on whther a Jaffa cake was a cake or a buscuit and how cakes go hard when going stale and buscuits go soft. The basically decided the VAT status of them.

[Eki]

Is the tax system in the UK loaded with deductions? I mean, are you able to deduct things like mortgage interest, retirement contributions, etc. from your gross income?


In Finland we can deduct mortgage interests, trade union membership fees and commuting expenses to and from work. Also hospital and medication costs if they go over a certain limit.

[Jag_Warrior]

Pension deductions are tax deductable.

Mortgage terms are usually taken over 25 or 30 years but may be shorter if you are older. Most lenders won't lend on a term which takes you over retirement age which is typically 65.

As for rate terms the world is your oyster so to speak. The larger the deposit the lower rate you can borrow at. You can also fix your deals to over short, medium or long term. Short term is around 2 years, medium is around 4 years and long term is about 7 years. Loans often change to a tracker rate
when the fixed deal ends. This is great rut now with at base rate at 0.5% as a tracker rate may be around 2% above the base rate. In times of higher rates I is probably more prudent to fix your interest rate.

Before the credit crunch you could take out 100% mortgages. Typically all lenders now require at least a 10% deposit. Although there are some product for people who previosuly took out 100% mortgages or have negative equity.

VAT is payable on some foods and not others. You wouldn't pay VAT on fruit and vegetables but you would on pay VAT on confectionary. There was a famous VAT case in the courts over something like Jaffa cakes if I remember rightly. The debate hinged on whther a Jaffa cake was a cake or a buscuit and how cakes go hard when going stale and buscuits go soft. The basically decided the VAT status of them.

OK, I was curious about that. So mortgages there are amortized over a 25-30 year term (much like here), but instead of being at a fixed rate for the entire term, they are variable rate. Thanks.

Also interesting that banks there may limit a term depending on age. Here you couldn't do that because of age discrimination. One of the last deals my dad did with me, he got a 30 year mortgage... and he was 75!

[GridGirl]

I suppose you could say rates are variable. You could have numerous fixed rate mortgages deals over an entire mortgage term but they could all be at different rates. A variable fix you might say. The idea of fixing at an interest rate for 30 years seems quite scary to me.

That's crazy that you dad could take a 30 year deal out at 75. Did you need to ensure his life to be able to take out that deal?

[Jag_Warrior]

I suppose you could say rates are variable. You could have numerous fixed rate mortgages deals over an entire mortgage term but they could all be at different rates. A variable fix you might say. The idea of fixing at an interest rate for 30 years seems quite scary to me.

That's crazy that you dad could take a 30 year deal out at 75. Did you need to ensure his life to be able to take out that deal?

No, he didn't need to take out any sort of insurance. It was an investment deal, but he could have gotten it even if it had been an owner occupied property. As far as I know, it's still the case that mortgage issuers cannot discriminate on the basis of age or health, only on ability to pay. And it's illegal here to require anyone to get life insurance on a residential mortgage. My uncle just refinanced his 30 mortgage and he's 71 now. Even I would be well past retirement age if I only paid the set amount on my 30 year. But I plan to pay it off just as I retire, so that I don't have to worry about that fixed expense.

The 30 year fixed rate (for the entire term) is the bread & butter of the residential mortgage market here. But you also have to remember that (before the recession) the average person only kept their home for about 7 years. Upon sale, the mortgage (first lien) is paid off. I built this house about 4 years ago. Not counting the construction loan, I'm on my third first mortgage on this house: the original first and I've refinanced twice. When the rates went down more than 1%, it made financial sense to refi. If they go up, my rate stays the same. The risk (rate wise) is on the lender's side.

On multi-unit properties I've usually been restricted to 15 or 20 year amortizations, but the rates (just as you described) would adjust yearly or every 3-5 years. That puts more of the risk on the borrower's side of the table.

Thanks for the info. I always find it interesting how the mortgage and property markets work in other places (House Hunters International is one of my favorite shows on TV at the moment). Argentina is VERY interesting, as private mortgages don't really exist there.