CtTaxed.com

Your real tax rate: 40% (National)

From msn.com

In a study for the National Bureau of Economic Research, Boston University economists Laurence J. Kotlikoff and David Rapson have found that our all-in marginal tax rate is 40%, give or take a bit. Yes, you read that right: 40%.

Most workers will pay about that much on each dollar of income when all taxes — federal and state income taxes, sales taxes, taxes for benefit programs, etc. — are considered.

As a consequence, a 30-year-old couple earning only $20,000 a year has a marginal tax rate of 42.5%, while a 45-year-old couple earning $500,000 pays at 43.2%. There are some exceptions: A 30-year-old couple earning $50,000 a year, for instance, pays 24.4%, and a 60-year-old couple making $150,000 a year faces a tax rate of 47.7%.

Lets compare against Sweden!

The tax burden in the Swedish economy tripled between 1950 and 1980. In 1970, when taxes were not much higher than they are in America today, Sweden’s GDP per capita ranked fifth in the world4. Since taxes passed 50 percent of GDP the country’s overall prosperity has dwindled, and the downturn has been most dramatic in measures of the standard of living. In 1970 Sweden ranked third in OECD for individual consumption, 39 percent above OECD average. By 1995, Sweden barely beat the OECD average, ranking 14th with an individual consumption 1.4 percent above OECD average, and has been stagnant since that time.

# Sweden is a slow-growth economy. After rising rapidly after World War II, economic performance stagnated once the burden of government reached high levels in the 1970s and 1980s. Since that time, inflation-adjusted growth has averaged less than 3 percent per year.

# Unemployment is now a significant problem in Sweden. The official jobless rate is about 8 percent, but independent estimates show the rate is closer to 20 percent.

# High taxes and excessive regulations have encouraged many large corporations to leave the country. Many individuals also are escaping the Swedish tax system, ranging from high-net worth entrepreneurs to new college graduates. This combination of capital flight and brain drain does not bode well for the future.

The economic model of where we are heading in this State and Country does exist in this world and we can see the natural consequences of a high taxation policy.  High unemployment, slow growth (same thing as high unemployment) and a decreased standard of living.  Sounds great to me!   What’s not to love?

As has been aptly said: ‘What has always made the state a hell on earth has been precisely that man has tried to make it his heaven.’ From the book “The Road to Serfdom” which I have been reading and will post on, soon.

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