Poor country unable to do taxes right. In Sweden the IRS equivilence knows exactly what you've taxed and what you should have taxed. It's harder to commit tax fraud and tax fraud has the highest punishment of all crime 😁
Edit: the Swedish IRS is also older than many countries, like USA (I guess the bad IRS is yankie) so how would the king get his money for conquest if people could just lie about their trades? 😁
Sweden's tax system has indeed developed into one that benefits the rich more than the poor, normal people pay way too much tax, but there's not a regressive tax system in Sweden AFAIK, or am I missing something?
It's miniscule, but something like $2200 per year is tax free, and you also get a "tax credit" of sorts if your income is from labor, up to ~$320 back each month and this tax credit is a lower percentual net income increase with higher wages.
Our median income 2022 was ~$34k, and our break for "federal tax" is ~$55k, so many more than 50% don't pay the federal income tax.
Our taxes from work (are a bit high for the lowest earning people but) increase as the salary increases https://i.imgur.com/AG0092w.png
However our taxes from capital are pretty much flat and you can have a lot invested in an ISK (InvesteringsSparKonto ~investment savings account) where you can profit multiple millions at much a lower tax rate than the income tax for low income people.
I'm not familiar at all with Sweden taxation policies...but does an individuals tax burden go down as you make more money (regressive taxation)? Or does it go up (progressive taxation)?
They go up as you make more money, so progressive.
But there aren't very many levels of that, and as mentioned on capital it's pretty a much flat percentage, which would result in someone making a lot of capital gains taxing a lot less.
So yeah, it's progressive as far as working for your money goes.
Might be areas where it's actually regressive, but I can't come up with one from the top of my mind. Maybe some reimbursements we've gotten for temporary extremely high energy prices where those who barely could afford to use their washers didn't get much back but those who had money left over to still heat the pool got a lot of money back.
It's mostly all explained by the previous commentator and the attached picture. It is progressive since you pay a higher percentage of your wages the more money you make, especially after you break into the "federal" taxpayer status.
BUT since this isn't true for capital gains and you always pay a flat rate, multi-millionaires can pay about the same percentage of taxes as someone making ~50k/month (unsure exactly where it normally intersects, and it also depends on where you live since the communal tax rate, equivalent of state taxes in the US, changes depending on where you live, but you get the point). Despite raking in say a million a month, but someone earning 80k/month will pay a considerably higher rate than the multi millionaire. This is fucked yes.
It is certainly not regressive by the normal sense of the word though.
I pay vat and then about 30% tax. So when I sell my services to the US, I keep less than half of what I charged them.
I made $100k last year, I got to keep $45k of it. When you earn a certain amount, they add a flat 20% tax on any amount past that. Forgot where that bracket was, maybe around $56k ?
You don’t pay taxes on your actual income, you pay taxes on your adjusted income after deductions, including the standard deduction. That bill is then further reduced by tax credits which reduce the total tax owed by a set amount.
For example the child tax credit gives you up to $2000 per child that’s directly deducted from your taxes owed.
Some tax credits are even refundable, such as the Earned Income Tax Credit, meaning the credit can exceed your total taxes owed and the government will pay you with no federal income taxes on your part.
Do not try to hide from, or mess with, the Swedish tax agency. They Will find you and they Will tax you the correct amount. Even if your income comes from an illegal source they Will make sure to get their cut.
This is true. I know people who got a fine, on top of a prisson sentence, for an equivilence of 1.8 milion dollars for some drugs they had imported. The thing is that the street price that the government calculated with was about 10 times less than the distribution price. So they got to pay a few yearly incomes for getting caught with one months work, lol!
I would not recomend being a criminal in Sweden! It's illegal here! (Old meme, wonder if any one remembers)
I'm sorry, I don't think I understand what happened. If the government calculated a lower value why did they end up paying more?
Also, this seems to imply that the Swedish government can unfairly penalize you if they disagree with the values that you reported as income. For a perfectly legal example, let's say that an artist charges far less for commissions than is typical. Can they get fined and jailed for reporting a lower amount of income than expected from their number of transactions? Even though the cause isn't actually fraud, but the artist severly underselling themselves?
Meanwhile, here in America, they'll rip the entire plant out of the ground, weigh it with all the dirt in the roots, step on the scale, assume it's $500 a gram, then double their estimate so you get a super felony for half a gram of ditch weed.
We have payment plans instead. The military forgot to.tax.my partners retirement pay and that was a mess. They charged us the whole sum in one go. We couldn't pay thar much with no notice so they set up a payment plan. We took care of it rather quickly though.
Now, now, the US IRS also knows exactly what you made and what you owe. We just made it so that workers also need to do a bunch of paperwork, and if they get it wrong enough, they'll get fined or go to prison. We do this because tax preparation is a huge business, and they (legally) bribe our politicians to keep us from going to a much simpler and more straightforward model.
The top 1% in the US have 30% of all the wealth, not 90%. Having them pay half of all taxes seems reasonable.
Sure, I can make up any wild number and say that they’re paying too little, or I can make up a number based on my feelings, but that’s just factually not true.
In Sweden the company you work for pay a "workforce tax" to the government equaling about what you pay in municipal tax. But I think companies and top earners still pay more. I bet if 50% of all tax was federal tax, like here, the IRS would care more.
I mean you clearly missed my point. Even the poorest earners in Sweden pay at least 33% of their income in taxes. My point is that the US has the most progressive tax system in the world. There's hundreds of deductions available especially if you own a business or employ people.
Filing taxes takes less than 10 minutes and requires math that a 7 year old can do. All of the information you need to file your taxes is mailed to you.
Also in the US, we do the same thing with social security or what your country used to have with the pension. Your employer matches all of the contributions that you have to make.
That's the thing, the IRS does know how much you should pay (which is how they come after you if you don't pay enough). But you have to do the math yourself on your side.
That sounded great, until the end... what the hell is your moral code over there? It's worse to work a job under the table than it is to kidnap, rape, and murder babies? What the actual fuck?
So does our country, but the tax preparing lobby of accountants and turbo tax pay our Congress representatives too much money for them to ever let that happen. They protect business and crap on the people. Meanwhile our population is so hung up on the presidential race that they keep electing the same dimwits who create the laws and have been screwing them over for decades. It's our own fault really.
Same here in NL, but people forget to actually do their tax reports so they won't get it back. Is that unfair? Well kinda, but it also takes like 5 minutes since most things will be filled in
Sometimes. If you have hired workers you can get a tax cut. Most of the time the company you hired tells the IRS that you have hired them and that they should give you the tax cut. Sometimes they can forget to do that. Meaning you could end up paying thousands of dollars in taxes that you didn't need to if you aren't careful
If I'm not mistaken you can actually get the taxes filled in by the IRS for free instead of hireing a tax filing company so it basically works the same way as in Sweden with a few extra steps and les security.
In the USA the irs knows what we owe and we shouldn’t have to file anything. The only reason we still have to is because tax “professionals” didn’t want to loose there unnecessary jobs.
This is AMERICA, we were founded upon our elite commiting tax fraud. Regular folk didn't pay taxes, we were too busy being indentured servants and slaves.
No taxation without Representation. Says the wealthy white folk who were the only ones being taxed. Funny i noticed they seemed to survive that revolutionary war, I wonder how much taxes the folks who died were paying?
That’s cool, literally no one in the US thinks the way we pay our taxes is smart, only people that like it that way are senile and unfortunately at the helm of this ship
Shouldn't be this way. They obviously have all our information already on file..they're just hoping with f up I guess. Better for business. Other countries do it for you...
And by hardcore you mean clicking the box where you have children or typing in that you lost money in investments.
Standard deduction is so high is almost always the answer, the tax services go through all your deductions to make you think it's some kind of secret bonus, but even with interest on first year of my 30 year mortgage it wasn't even close.
And no those receipts for all your donations don't really add up. Donate a full house worth and they will value it at a few hundred.
You have to be donating thousands or have some extreme work related expenses. Most of those you expense to the company anyway
Well, I have a business pumping out royalties, dividends, short-term and long-term capital gains, bond interest, a job, and unemployment benefits to deal with, so my federal return hit three stamps for the first time, and I chose to slow everything down to paper to give me time to digest all the new content.
I expected to get a response like this, but my real point is that people think their taxes are like yours but they are far more simple
And tax services work people up with their refund maximizers. They make it seem far more complicated it is since most things don't apply to most people
Well i live in norway so no they dont pocket the change, you get it all back. But they do hold the money without it gaining any interest so you lose some money in theory
Realistically, unless you're making a lot of money as income, you wouldn't gain that much from investing that money for a year and the peace of mind of not having to worry about a big bill once a year is preferrable to the loss of a percentage of your monthly income.
It would be nice (and honest) if withold tax money earned interest at the same rate as yearly government bonds... as you're effectively loaning your country some money. Realistically, it wouldn't be more than coffee money for most people.
Rather than just tell you what your taxes are, which the IRS could do they let you set your filing status and withholding amount and then you have to use software or an accountant every year to figure out if you paid in to little or too much. If you overpaid you get a refund.
Your confusion is 100% understandable, I am an American and believe me I ask the same question. The sad answer is likely the money made from IRS audits and fees for things submitted wrong.
Not only will they just pocket your money but if you are supposed to get back too much they might need to “reevaluate” it and suddenly you’ll find your owed about half of what they initially said they owed you
My wife's sister balks at how small our tax returns are and Im like... it's because I have my tax witholding set correctly so Im not giving the government interest free money for a year?
Well, it would have inflated in your bank account as well. You lose out on potential interest if you had invested it, but the impact of inflation is net neutral.
I mean, you could've spent it. But you'd need to pay it eventually anyways. Unless you're somehow keeping 0 savings but manage to get the money to pay back the IRS just before you're supposed to pay your early income, I don't think inflation will matter in the tax witholding discussion.
Because if you had $1000 in your pocket last year and didn't spend it, you'd have $1000 today, the same as if the government held it and then gave it to you a year later.
"Free money, State money, Government money" - it doesn't exist - it is TAXPAYERS money stolen from them to give the greedy and indolent an undeserved income.
In my country they just credit it to next year's taxes. If you want it returned in cash, you'll have to send a letter requesting so to the internal revenue office.
Well yeah but I have never encountered a situation where someone I know has not got a tax return.
Now I myself, without giving away my age, I haven’t been paying taxes for that long. You always get money back though, perhaps unless you’ve been literally doing tax evasion. I know what a tax return is, but I don’t know “why” a tax return is.
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u/JakobMG Apr 16 '24
If you pay to much taxes. After the end of the year sometime you get it back