Nous voulons un impôt européen sur les grandes fortunes pour financer la transition climatique et sociale et aider les pays victimes des dérèglements climatiques.
What about doing actually interesting stuff like making sure that in some EU countries citizens can’t get taxed at 50% and we set a EU wide limit for income taxes and a flat tax approach instead of the progressive bullshit we’ve right now?
Progressive income taxes are essentially the govt saying “we don’t want you to become better, earn more and have a better life, just be poor”.
You don’t understand how progressive taxes work. No one is punished for earning more. Even if you reach he maximum rate, the maximum rate is only coming out of your disposable income (unless you are a complete idiot living no only above your means but well above what’s reasonable).
In practice that’s doesn’t work out. Govts don’t care about properly defining what constitutes as “disposable income” and in the EU we don’t get all the nice tax benefits people get in the US. It’s just rape to tax someone at 15% and then someone else who makes 2x that at 45% or something like that.
Furthermore why should I be taxed for “disposable income”? I should be able to save and invest some money (stuff that ins’t deductible in most of Europe). I don’t live paycheck to paycheck and have to get a loan and live of credit cards like most of the US does.
So, yes, my country does tax me for earning more, the money comes straight out of my monthly paychecks, I don’t even see it. Only if I’ve healthcare, education and a few other expenses I may see a small fraction of that money coming back to me, but up to some limit. If I decide to buy a car, a house or invest in stocks I won’t be ever see that money back.
That’s not how it works. The 45% doesn’t apply to your entire income, only to the part above the threshold. For example, if you work in Germany, you only pay 45% on what you earn above €227k, and you’ll always pay 0 taxes for the first €11k.
I believe I’m not explaining myself clearly here. I’m aware of what you’re saying but using your example I still don’t see why I should be taxed 45% on income over 227k. I do understand that my first 11k will be tax free, the from 11k to some other value I’ll pay 10% and so on. I just don’t agree with taxing people that way.
If you look at countries like Portugal, Spain a few others you’ll see that people are getting squeezed by their governments with a combination of progressive taxes paired with recent inflation. The cost of living in those countries right now requires people to have wages that are taxed to absurd values because “they’re rich” and when if you boil it down you’ve people that can barely afford to rent a single bedroom flat and don’t even own a car.
I doubt people earning over €227,000 a year have any issues paying for rent, why shouldn’t they get taxed more to bring earnings more in line? That way more money can go to support the lower earning demographics.
Well and they are… consider an hypothetical country that runs a flat tax of 15%, if you make 20k/year you’ll be paying 3k, if you make 300k you’ll be paying 45k. In this scenario those rich people are paying more and the system is fair - after all the cost of building a road, school, hospital or helping people with a disability doesn’t suddenly increase if someone is making 300k on that country.
Saying that someone who makes 20k should pay 15% and than someone who makes 300k should pay 50% (even if that’s on a fraction) that’s just unfair and pushing people into not wanting to do better.
There’s a certain cost of living. Housing, food, transport. There’s a certain “floor” you have to earn or you’ll have a miserable time in the world as it is.
Once you get above that earnings floor wealth suddenly starts to accumulate. You can get a nicer house, a fancier car, go out to eat and vacation more often. Which is all nice and good, people should be able to do such things, but those are secondary luxuries on top of what you need to live.
So instead of taxing everything, say, 50%, the lower brackets are given some slack with reduced taxes.
Look, I’m well aware of Engel’s law. I just don’t agree with you, nor I agree with what most countries do, just become someone is above the line and has the ability to accumulate it doesn’t mean that person should pay an higher percentage. I believe the system should be fair, everyone should be taxed at the same flat rate such as 15% and that everyone can live comfortably with that tax.
If, as you say, we find that the percentage to be unbearable for some people we then fix what’s wrong there, not by changing the percentage but, by making sure those people earn more and are on a better position.
Your numbers about median income are correct, however the ones about the housing market aren’t.
Almost nobody makes 81k/year in Portugal, if so must be working for some company abroad or in some scheme. Anyways, a 3 bedroom apartment in a major city in Portugal doesn’t cost 1,6k/month, not even close, those are prices from a decade ago or so. Right now 1.6k/month will get you an 1 bedroom apartment or a very small and old 2 bedroom one.
In order to get to those 33k/year incomes you’ll be forced into living in a city and at that point you’re already taxed to death and you’ll be living paycheck to paycheck, can’t save any money etc. Consider this example: after taxes (lets say 25%) if you spend 1.2k/month in your 1 bedroom flat you’ve 860€/month left for food, health, car, other taxes, expenses etc. you may not be (very) hungry but you won’t be saving any money either.
To make things considerably worse it’s not a good ideia to rent / buy in any place over 50KM from major cities because 1) you don’t have decent public transportation, 2) getting a car on that wage is hard, 3) gas prices and parking fees are crazy right now.
I’m assuming you’re American so driving 100KM/day to get to and back from work may look reasonable, but in Portugal that’s 100KM on broken roads / expensive tolls, expensive gas and about 2h-3h of your day depending on traffic and parking.
Median mean 50% of the country make more or less. So 31k is still rough.
You said the richer people in the tax bracket was struggling because taxes(at least how I took or understood what you said)
I can’t argue your lived experience but this is also how it is in America. Everyone who wants a decent job has to be close to a major city or be related to the rich people in the small towns and things are expensive. I commuted 150 miles a day (241 km) just so I could afford rent with 4 other people in my house. I spent 4 hours on commuting so my days were 12 hours it was exhausting.
Either way it isn’t taxes it is businesses paying poorly, bad production or manufacturing for cost of living necessities, and ownership class being ridiculous. Not sure what your politics are but taxes help the poor with health care, roads, and infrastructure. Also keeps the rich from controlling more.
If we look at recent data here it’s actually worse than what we were discussing. According to official statistics average wage is 1,463€/month in 2023… so that makes up to about 20k/year.
Also, looking at the actual numbers, in Portugal you hit the 37% tax bracket at just €27,000 and 45% at around €50,000. These salaries definitely do not make you rich, but they make you owe a ton of taxes.
Additionally, as stated on the article, the rich already pay an extra:
In 2024, an additional solidarity rate, which varies between 2.5% and 5%, applies to taxpayers with a taxable income exceeding EUR 80,000 and EUR 250,000, respectively.
…
You said the richer people in the tax bracket was struggling because taxes
What I’m actually saying is that there are a lot of middle class people here that get fucked over every time the “tax the rich” dialog comes along because the govt considers people making 33k+/year to be rich.
Bottom line is: whenever the radical left here starts bitching and pushing for legal changes on taxes then the barely surviving 33k/year middle class gets squeezed again and nothing else changes.
This “taxing the rich” stuff is kind of a lie people like to throw around because if you’re making 300k/year you’ll always have ways around the income tax and you won’t be paying anyways.
Progressive taxes are a way to make up for the imbalance of poorer people spending a higher proportion of their income on essentials, it’s a fundamental of economics. Although I have heard that the tax brackets in Russia are completely flat (not that that makes it any better).
The logic behind doing more, working extra, going to university, starting companies and all of that is to make more money so you won’t be just surviving. Taxing that people an higher percentage just because they make more money is effectively punishing people for their hard work and telling younger generations that they shouldn’t work very hard.
Look the issue here isn’t that you’ve people making more money - those people should actually be rewarded for it, because making more money means more contribution to society - but that there are people making less than they should / is feasible to have a comfortable life in modern times. I would rather fund initiatives to improve those “poorer people” life’s than this.
What about doing actually interesting stuff like making sure that in some EU countries citizens can’t get taxed at 50% and we set a EU wide limit for income taxes and a flat tax approach instead of the progressive bullshit we’ve right now?
Progressive income taxes are essentially the govt saying “we don’t want you to become better, earn more and have a better life, just be poor”.
You don’t understand how progressive taxes work. No one is punished for earning more. Even if you reach he maximum rate, the maximum rate is only coming out of your disposable income (unless you are a complete idiot living no only above your means but well above what’s reasonable).
In practice that’s doesn’t work out. Govts don’t care about properly defining what constitutes as “disposable income” and in the EU we don’t get all the nice tax benefits people get in the US. It’s just rape to tax someone at 15% and then someone else who makes 2x that at 45% or something like that.
Furthermore why should I be taxed for “disposable income”? I should be able to save and invest some money (stuff that ins’t deductible in most of Europe). I don’t live paycheck to paycheck and have to get a loan and live of credit cards like most of the US does.
So, yes, my country does tax me for earning more, the money comes straight out of my monthly paychecks, I don’t even see it. Only if I’ve healthcare, education and a few other expenses I may see a small fraction of that money coming back to me, but up to some limit. If I decide to buy a car, a house or invest in stocks I won’t be ever see that money back.
That’s not how it works. The 45% doesn’t apply to your entire income, only to the part above the threshold. For example, if you work in Germany, you only pay 45% on what you earn above €227k, and you’ll always pay 0 taxes for the first €11k.
I believe I’m not explaining myself clearly here. I’m aware of what you’re saying but using your example I still don’t see why I should be taxed 45% on income over 227k. I do understand that my first 11k will be tax free, the from 11k to some other value I’ll pay 10% and so on. I just don’t agree with taxing people that way.
If you look at countries like Portugal, Spain a few others you’ll see that people are getting squeezed by their governments with a combination of progressive taxes paired with recent inflation. The cost of living in those countries right now requires people to have wages that are taxed to absurd values because “they’re rich” and when if you boil it down you’ve people that can barely afford to rent a single bedroom flat and don’t even own a car.
I doubt people earning over €227,000 a year have any issues paying for rent, why shouldn’t they get taxed more to bring earnings more in line? That way more money can go to support the lower earning demographics.
Well and they are… consider an hypothetical country that runs a flat tax of 15%, if you make 20k/year you’ll be paying 3k, if you make 300k you’ll be paying 45k. In this scenario those rich people are paying more and the system is fair - after all the cost of building a road, school, hospital or helping people with a disability doesn’t suddenly increase if someone is making 300k on that country.
Saying that someone who makes 20k should pay 15% and than someone who makes 300k should pay 50% (even if that’s on a fraction) that’s just unfair and pushing people into not wanting to do better.
No, that is not how it works.
There’s a certain cost of living. Housing, food, transport. There’s a certain “floor” you have to earn or you’ll have a miserable time in the world as it is.
Once you get above that earnings floor wealth suddenly starts to accumulate. You can get a nicer house, a fancier car, go out to eat and vacation more often. Which is all nice and good, people should be able to do such things, but those are secondary luxuries on top of what you need to live.
So instead of taxing everything, say, 50%, the lower brackets are given some slack with reduced taxes.
Look, I’m well aware of Engel’s law. I just don’t agree with you, nor I agree with what most countries do, just become someone is above the line and has the ability to accumulate it doesn’t mean that person should pay an higher percentage. I believe the system should be fair, everyone should be taxed at the same flat rate such as 15% and that everyone can live comfortably with that tax.
If, as you say, we find that the percentage to be unbearable for some people we then fix what’s wrong there, not by changing the percentage but, by making sure those people earn more and are on a better position.
Portugal $81,199 eur you pay $29,940 in tax. That makes $52,059 take home pay or $4,338 a month average cost of monthly expenses(not including rent)is $ 2572 leaving $1765 leftover over a month. 3br apartment in city is $1,666. Seems doable without even having a second worker in the house. Especially on the higher end of the tax bracket https://www.numbeo.com/cost-of-living/country_result.jsp?country=Portugal#:~:text=A family of four estimated,lower than in United States.
I am more concerned with Portugal average salary of $33k eur and median being $31k that just isn’t doable
All the progressive tax systems are fine it sounds like your wages/cost of living sucks. That is the true problem.
Your numbers about median income are correct, however the ones about the housing market aren’t.
Almost nobody makes 81k/year in Portugal, if so must be working for some company abroad or in some scheme. Anyways, a 3 bedroom apartment in a major city in Portugal doesn’t cost 1,6k/month, not even close, those are prices from a decade ago or so. Right now 1.6k/month will get you an 1 bedroom apartment or a very small and old 2 bedroom one.
In order to get to those 33k/year incomes you’ll be forced into living in a city and at that point you’re already taxed to death and you’ll be living paycheck to paycheck, can’t save any money etc. Consider this example: after taxes (lets say 25%) if you spend 1.2k/month in your 1 bedroom flat you’ve 860€/month left for food, health, car, other taxes, expenses etc. you may not be (very) hungry but you won’t be saving any money either.
To make things considerably worse it’s not a good ideia to rent / buy in any place over 50KM from major cities because 1) you don’t have decent public transportation, 2) getting a car on that wage is hard, 3) gas prices and parking fees are crazy right now.
I’m assuming you’re American so driving 100KM/day to get to and back from work may look reasonable, but in Portugal that’s 100KM on broken roads / expensive tolls, expensive gas and about 2h-3h of your day depending on traffic and parking.
Median mean 50% of the country make more or less. So 31k is still rough.
You said the richer people in the tax bracket was struggling because taxes(at least how I took or understood what you said)
I can’t argue your lived experience but this is also how it is in America. Everyone who wants a decent job has to be close to a major city or be related to the rich people in the small towns and things are expensive. I commuted 150 miles a day (241 km) just so I could afford rent with 4 other people in my house. I spent 4 hours on commuting so my days were 12 hours it was exhausting.
Either way it isn’t taxes it is businesses paying poorly, bad production or manufacturing for cost of living necessities, and ownership class being ridiculous. Not sure what your politics are but taxes help the poor with health care, roads, and infrastructure. Also keeps the rich from controlling more.
If we look at recent data here it’s actually worse than what we were discussing. According to official statistics average wage is 1,463€/month in 2023… so that makes up to about 20k/year.
Also, looking at the actual numbers, in Portugal you hit the 37% tax bracket at just €27,000 and 45% at around €50,000. These salaries definitely do not make you rich, but they make you owe a ton of taxes.
Additionally, as stated on the article, the rich already pay an extra:
…
What I’m actually saying is that there are a lot of middle class people here that get fucked over every time the “tax the rich” dialog comes along because the govt considers people making 33k+/year to be rich.
Bottom line is: whenever the radical left here starts bitching and pushing for legal changes on taxes then the barely surviving 33k/year middle class gets squeezed again and nothing else changes.
This “taxing the rich” stuff is kind of a lie people like to throw around because if you’re making 300k/year you’ll always have ways around the income tax and you won’t be paying anyways.
deleted by creator
Progressive taxes are a way to make up for the imbalance of poorer people spending a higher proportion of their income on essentials, it’s a fundamental of economics. Although I have heard that the tax brackets in Russia are completely flat (not that that makes it any better).
The logic behind doing more, working extra, going to university, starting companies and all of that is to make more money so you won’t be just surviving. Taxing that people an higher percentage just because they make more money is effectively punishing people for their hard work and telling younger generations that they shouldn’t work very hard.
Look the issue here isn’t that you’ve people making more money - those people should actually be rewarded for it, because making more money means more contribution to society - but that there are people making less than they should / is feasible to have a comfortable life in modern times. I would rather fund initiatives to improve those “poorer people” life’s than this.