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Starvid suggests to cut taxes instead. Which taxes he wants to cut? Income tax is hardly paid by poor people. VAT incentives saving over consumption and is in the income ranges between poor and middle class highly progressive, when food, clothes and rent are free of it. Extra high VAT on energy and co is a feature for the environment. So which tax he wants to cut?

Things might be different in Germany, but in Sweden low income earners (that is, poor people) pay high income taxes.

Let's say you make 2000 euros a month before taxes. That's 24,000 a year. First about 2000 euros are tax exempt. Then you pay about 32 % on the remaining sum. That's 7040 euros a year in tax, or 29.3 %. You get to keep 16,960 euros.

On top of that you have hidden income taxes, so called "social fees". They are parts of your wage taxed away even before the money shows up on your salary. They are another 38 % on top of your wage.

This means that if you make 2000 euros a month "before" taxes you are really making 2000*1,38=2760 euros a month, or 33,120 euros a year. Of this you get to keep 16,960 euros. That means you are really paying a 49 % income tax on a pretty crappy wage.

So yes, there is a lot of space to cut taxes for poor people before stuff like basic income for all need be considered.

Peak oil is not an energy crisis. It is a liquid fuel crisis.

by Starvid on Thu Oct 9th, 2008 at 12:52:04 PM EST
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