Overall Taxation Rate
February 15, 2010 12:51 PM Subscribe
What is our real taxation rate? Is there a program or set of instructions to help determine each individual's rate of taxation, considering Fed/State Income, Workman's Comp, Unemployment, County Property, Auto, city trash/water/gas, telephone, internet, etc.? Granted, it would take some research per individual, but it would be worth it. French complain of 50% What is mine?
I worked mine out by adding up my state and federal taxes, my SSI taxes, and then making a separate line for property taxes, and then another line for health care costs. (The argument I was in at the time relating to health care costs in the U.S. vs. Europe.)
This allowed me to pull out JUST income taxes, "total" tax burden of income & property, add in what I currently pay for health care if I wanted, etc.
Chasing down all the smaller ones, you'd have to decide if they counted as taxes or fees, and if it was applicable for a direct comparison or not. I wouldn't count my telephone taxes as part of my tax burden because they basically pay for just the telephone stuff and I could avoid them if I didn't have a telephone; you'd also have to find out if the French pay telephone taxes and if they're including that in their list when you make your comparison. Generally these are consumption taxes in some form, and as you did not include sales tax in your list, I assume you're not interested in consumption taxes. But you could easily add into your spreadsheet listing all the minor taxes and fees you pay, though I think collecting them all would be hard. (Would you could tolls, for example? Tolls on government toll roads but not private ones? Would you could tolls on government toll roads contracted to private companies?)
Easy enough to do with your W2s and a spreadsheet.
Also keep in mind that I don't think very many European countries use property tax the way the U.S. does. This complicates direct comparisons between the U.S. and Europe, since property taxes in the U.S. are a significant source of government revenue that pay for major services (such as education, in my state), but property taxes are set in very different ways than income taxes and if you live in a very expense or very cheap home for your "income bracket," your property taxes will "skew" your tax burden in a one-to-one comparison with someone else.
posted by Eyebrows McGee at 1:23 PM on February 15, 2010
This allowed me to pull out JUST income taxes, "total" tax burden of income & property, add in what I currently pay for health care if I wanted, etc.
Chasing down all the smaller ones, you'd have to decide if they counted as taxes or fees, and if it was applicable for a direct comparison or not. I wouldn't count my telephone taxes as part of my tax burden because they basically pay for just the telephone stuff and I could avoid them if I didn't have a telephone; you'd also have to find out if the French pay telephone taxes and if they're including that in their list when you make your comparison. Generally these are consumption taxes in some form, and as you did not include sales tax in your list, I assume you're not interested in consumption taxes. But you could easily add into your spreadsheet listing all the minor taxes and fees you pay, though I think collecting them all would be hard. (Would you could tolls, for example? Tolls on government toll roads but not private ones? Would you could tolls on government toll roads contracted to private companies?)
Easy enough to do with your W2s and a spreadsheet.
Also keep in mind that I don't think very many European countries use property tax the way the U.S. does. This complicates direct comparisons between the U.S. and Europe, since property taxes in the U.S. are a significant source of government revenue that pay for major services (such as education, in my state), but property taxes are set in very different ways than income taxes and if you live in a very expense or very cheap home for your "income bracket," your property taxes will "skew" your tax burden in a one-to-one comparison with someone else.
posted by Eyebrows McGee at 1:23 PM on February 15, 2010
This is a much more complicated question that it appears at first blush, and not just because many people don't understand how marginal tax rates work:
When you start talking about worker's comp and unemployment, it get's difficult - those are hidden taxes that aren't evident in your income, e.g., if you get paid $x/hr, it is actually costing your employer another $y/hr that you never see. It wouldn't be possible to figure out, but it would be a lot harder. However, I'm not sure that these compelled fees/amounts/taxes you never see are substantively different from the other employment-related taxes that you do see, like FICA and SS.
Another hard issue is the extent to which your expenditures (like rent, for example) include taxes that increase those expenditures (like property taxes).
If you're just talking about taxes you pay out of the income you "receive" (which I think is what you talk about when you talk about this), just add up all the taxes you pay against your total, top-line income, and divide. You can generalize for things that are the same for everyone - a single person with an income of x, living in this location, taking only this standard deduction, pays total non-consumption-based taxes of z. From there, you can figure out how that person spends z and determine the additional sales and similar taxes he pays.
Things get tough when you add in capital gains and dividends, but again it's more about the nomenclature.
posted by iknowizbirfmark at 1:31 PM on February 15, 2010 [1 favorite]
When you start talking about worker's comp and unemployment, it get's difficult - those are hidden taxes that aren't evident in your income, e.g., if you get paid $x/hr, it is actually costing your employer another $y/hr that you never see. It wouldn't be possible to figure out, but it would be a lot harder. However, I'm not sure that these compelled fees/amounts/taxes you never see are substantively different from the other employment-related taxes that you do see, like FICA and SS.
Another hard issue is the extent to which your expenditures (like rent, for example) include taxes that increase those expenditures (like property taxes).
If you're just talking about taxes you pay out of the income you "receive" (which I think is what you talk about when you talk about this), just add up all the taxes you pay against your total, top-line income, and divide. You can generalize for things that are the same for everyone - a single person with an income of x, living in this location, taking only this standard deduction, pays total non-consumption-based taxes of z. From there, you can figure out how that person spends z and determine the additional sales and similar taxes he pays.
Things get tough when you add in capital gains and dividends, but again it's more about the nomenclature.
posted by iknowizbirfmark at 1:31 PM on February 15, 2010 [1 favorite]
Duh, should be "it wouldn't be impossible to figure it out."
posted by iknowizbirfmark at 1:33 PM on February 15, 2010
posted by iknowizbirfmark at 1:33 PM on February 15, 2010
Do you want to count sales tax? Most people pay sales taxes on nearly everything they buy, and the rates vary wildly by state, as well as by type of item purchased. People have attempted to estimate it, but it'll vary from person to person depending on what you buy.
posted by decathecting at 3:09 PM on February 15, 2010
posted by decathecting at 3:09 PM on February 15, 2010
If you do your taxes with Quicken, it will tell you your overall income tax percentage (tax/total income) on the page that prints out along with your return. This won't include taxes besides income tax, but it's a start.
posted by Kadin2048 at 3:26 PM on February 15, 2010
posted by Kadin2048 at 3:26 PM on February 15, 2010
If you look at how complicated French taxation is, you'll realize that even if you figure out the number for yourself, you're not even half done.
posted by smackfu at 3:39 PM on February 15, 2010
posted by smackfu at 3:39 PM on February 15, 2010
This thread is closed to new comments.
My effective tax rate is somewhere around 26% for Fed and State taxes. Don't get workman's comp, unemployment, I rent, don't own a car, landlord pays for trash/water, employer pays for phone. Although if you want to include sales tax... that's something that you can directly control.
Overall, much less than 50%.
posted by mallow005 at 1:18 PM on February 15, 2010