
Why I love Swedish taxes - ainiriand
https://www.vox.com/2016/4/8/11380356/swedish-taxes-love
======
sebcat
The linked article claims that they only pay 31% tax, but that's only a part
of the tax they pay, not including VAT or the part of your salary paid by your
employer, that you don't receive.

Martin Borgs made a movie about swedish taxes: Somebody Else Pays. It's
watchable on youtube, with english subtitles:
[https://www.youtube.com/watch?v=vdi-
Lg9pwkY](https://www.youtube.com/watch?v=vdi-Lg9pwkY)

I really recommend watching it.

~~~
kcorbitt
The best way I've found to compare taxes between countries with very different
tax regimes is by comparing tax revenue as a percentage of GDP. Wikipedia has
a nice table:
[https://en.wikipedia.org/wiki/List_of_countries_by_tax_reven...](https://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_to_GDP_ratio)

Denmark tops the list, at 50.8%. Sweden comes in 4th, with 45.8%. The US is
fairly far down and lower than almost all developed countries, at 26%.

~~~
wav-part
Tax Revenue USD/Capita:
[https://data.oecd.org/chart/4Ont](https://data.oecd.org/chart/4Ont)

Welfare Spending USD/Capita:
[https://data.oecd.org/chart/4Ons](https://data.oecd.org/chart/4Ons)

~~~
isostatic
In 2013, the United States spends $9350.80/head on social programs. The United
Kingdom spends $8116.20/head.

Yet it's the UK that has healthcare free at the point of use. Where does that
social spending go in the US? Why is it so inefficient?

~~~
mcv
That's exactly it. In many cases it seems Americans pay just as much as
Europeans, but get much less value in return. They pay more for healthcare
than anyone else, yet have shorter life expectancy. They even pay a lot of
socialized healthcare (Medicare) which isn't accessible for most people. They
pay for public education but complain about the poor quality. For higher
education, the options are to go deep into debt or opt for a low-pay career.
They pay for police that's likely to shoot them and take their stuff. And then
they pay for an excessive military and government corruption. (Alright, slight
hyperbole, but only slight.)

I think dogmatic belief that laissez-faire capitalism is always more
efficient, has prevented them from looking for efficiencies elsewhere.

------
erikbern
Somewhat speculative, but as a Swedish person living in the US, a huge
difference between the gov't spending is that very little is means tested in
Sweden. Doesn't matter how much your income is, you still receive child
allowance, extremely subsidized child care, schools, etc.

As a consequence, the welfare system is as much of a transfer between rich and
poor as it is between different parts of life. And I suspect the willingness
to pay higher taxes is that (almost) everyone "benefits" from the it at some
point (putting it in citation marks since there's no free lunch obviously).

In contrast, US has far more means tested programs like SNAP etc, and the
things that the wealthy benefits from are things like mortgage interest
deductions, which are not seen as gov't spending in the same way. Which I
think goes a long way explaining the tax adversity in the US.

~~~
youdontknowtho
That's a great point. Means testing is portrayed as fairness because only
people that really need something will be the ones to get it...but that ends
up being something that makes everyone who makes just a little too much to get
the benefit really angry.

~~~
BurningFrog
The universal approach is also immensely less complicated, both for the
government and the beneficiaries.

It also doesn't create a "marginal tax" trap where if poor people get a higher
income, they can lose 100% or more of it to lost benefits.

------
calcsam
"These wilderness islands with haunting sea caves are accessible only by tour
boat at a cost of $151 for a family of two adults and three children. There is
no free 15-minute ride across the strait to Basswood Island closest to the
mainland, nor a $10 shuttle between the islands, as there would be in Sweden
where a heavily subsidized ferry system makes the Stockholm archipelago
available to all citizens — as well as to American tourists."

Surprisingly, there are also fewer visitors to a wilderness island in the
middle of Lake Superior in the sparsely populated northern Wisconsin area than
to Stockholm, the capital of Sweden.

~~~
BurningFrog
When I hear people describe how France is, they almost always talk about
Paris. Same thing with Sweden and Stockholm.

Unsurprisingly, the capital city of a country during a vacation is nicer than
your boring home town during a regular work week.

~~~
true_religion
Then there is the USA, where the capital hardly breaks the ranks of the top 5
most exciting destinations.

Disclaimer... DC is my hometown so I am blase about all the museum and
monuments.

~~~
isostatic
Sure, but that's because the US has so much spread out. In the UK, almost
everything internationally interesting is in London. Sure there's "Scotland"
(a day trip to edinburgh), "Shakespereland" (day trip to Stratford on Avon),
"Beatlesland" (day trip to Liverpool), and maybe Stonehenge (day trip to
Salisbury) but the majority of things are in London. The Lake District or
Scottish highlands are good, but you get mountains and lakes all over the
world.

In the US the capital is Washington, and that's interesting to some extend,
but you've got the big tier cities - NY and LA, and the next tier of touristy
cities like Philly/Boston (for 'history'), San Francisco, Vegas and maybe
Seattle and Chicago.

If you were to have the historical, financial, political and entertainment
capital all in Washington, which is what you have with France, UK, Sweden etc,
then that would be a far more exciting destination than just the political
capital.

------
apsec112
Trying to pay for services through taxes in the US is like Tantalus trying to
drink from the river. No matter how much money is raised, the "price" just
goes up even more. Case in point: American health care. The US actually spends
more, _more_ , tax dollars per capita on healthcare than countries like the UK
or Canada or Australia. OK, the US did put up the cash, so it should get
universal coverage right... hahaha of course not. Likewise with the high-tax
Bay Area, which has by far the worst roads in the US, with 71% in "poor"
condition. Or high-tax New York City, where a single new subway station costs
billions of dollars.

~~~
afarrell
One issue with trying to reform the American healthcare to be more efficient
is that as the system is now, healthcare spending accounts for 17.1% of US
GDP[1] while in the EU it is an average of 10%. There is a word for
eliminating 7% if your country's GDP: recession. If you were to switch to,
say, a single-payer system then you would eliminate whole categories of jobs.
You might be able to replace that with additional service but it would be very
hard. Imagine someone who's made a career out of working for hospitals and
calling insurance companies to cajole them into paying up -- what would they
do?

It is like the IRS pre-calculating your taxes or US society as a whole taking
meaningful action on climate change: change would threaten a large number of
people's jobs and those people are very motivated to resist it.

[1]
[http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS](http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS)

~~~
mbroncano
Another way to think about it is, your country suddenly finds itself with an
additional, disposable 7% GDP. Alternatively you can afford extra ~40% health
coverage in the form of personal care, hospitals etc.

Edit: grammar, numbers ...

~~~
afarrell
Except this isn't Age of Empires. That "7% GDP" is a bunch of unemployed
people who have the potential to do useful things, but some-to-most their
skills are geared toward navigating an inefficient system that doesn't exist
anymore.

Some will be able to easily re-apply those skills. Some won't. Even the ones
that will are going to be scared of the transition because losing your job is
scary.

Of course, much of this _would_ be offset by setting up services like the UK's
111 (medical advice hotline) and by being employed by companies like the one
my sysadmin-for-the-federal-government father has always wanted to start but
can't in case his cancer comes back. But those are both much more abstract and
distant hypotheticals that don't yet have voters behind them.

------
arcticbull
Let's not forget, the top marginal tax rate for someone living in the State of
California is 39.6% federal + 13.3% California + 0.9% health surtax = 53.8%.

The top tax rate in Sweden is 57.10%.

For 4% more tax money, they get socialized education, healthcare, public
transit, childcare, public parks and a litany of other services.

This comparison excludes payroll taxes / medicare, social security and sales
taxes since I believe the Swedish numbers exclude those too.

~~~
niceperson
Why would you want to "pay" for any of that unconditionally and have your
income delegated by someone else when the free market offers a superior
solution?

~~~
isostatic
US Healthcare cost: 17% of GDP Sweden healthcare cost: 10% of GDP

Which is superior?

~~~
bjelkeman-again
Cost is not the only comparison. The US scores last in this study of eleven
countries. Sweden third. Having received healthcare in the US, the U.K. and
Sweden, I personally prefer Sweden. But as the US is a very large place it is
hard to generalise.

[http://www.commonwealthfund.org/publications/fund-
reports/20...](http://www.commonwealthfund.org/publications/fund-
reports/2014/jun/mirror-mirror)

~~~
isostatic
The UK spends a tiny amount on health care - $1400 a year less per head than
comparative european countries like Germany, France, Belgium etc, and $5,400 a
year less per head than the USA. Yet it has better healthcare than the USA.

------
refurb
Hmmm... not a very sophisticated article.

It seems rather apologetic. Income taxes aren't that much higher! But for some
reason taxes are 23% of GDP in the US, but 43% in Sweden. So obviously taxes
are _much_ higher in Sweden.

Yes, there is a steep sales tax, but it's rolled into the price, so you don't
really know what it is, so it's all good.

~~~
tcfunk
That was a very small section of the writeup, and I feel you've missed the
point. The author isn't arguing that taxes are lower/the same as the US. He's
stating very clearly that they are higher -- it's even in the title.

The argument is that we have the wrong mindset about taxes here in the US.

------
amscanne
This article starts with a conclusion and works backwards without any
legitimate attempt at analysis.

For example, I have no idea on what basis one could argue that a fixed "real
estate fee" is more rational, effective or fairer than conventional property
taxes.

> This is the same for everyone no matter what the assessed value of the
> dwelling. The fee is $12 a month for our co-op apartment in Stockholm. If we
> owned the same property in Madison, our taxes would be $18,000 a year.

Is their co-op apartment worth $2mm USD or something?

The argument that Sweden achieves better outcomes overall is valid, but that
doesn't make every thing they do perfect.

~~~
maxsilver
> Is their co-op apartment worth $2mm USD or something?

As expats in Sweden, they might not live in Wisconsin often enough for it to
be considered their "primary residence" or homestead, and might have to pay a
higher tax rate because of that.

I don't know about Wisconsin, but in Michigan if you can't claim primary
residency exemption, your property taxes automatically jump up by roughly 50%

------
bjornsing
If you "walk the beaten path" of life - get an education, have a family, work
as an employee of some big company or government (or a university like Tom),
etc. - then the Swedish tax system is nothing to complain about, really. You
get more or less your money's worth.

But IMHO it does limit your freedom, in the sense that you have to pay for
those on that path no matter what life choices you make.

~~~
wsc981
I agree.

I am from The Netherlands and as a freelancer I am quite sure I pay more than
50% in taxes, when including VAT from goods bought in a store, property taxes,
etc... And I also _know_ I have less choices, less financial freedom. Last
year I had to pay over 30.000 EUR income tax. Money that I believe I could
spent much better.

A big problem in The Netherlands (and perhaps the same is true for Sweden) as
that if you're single, you live alone, don't have kids, then a huge tax burden
is put upon you. And you miss out on a lot of benefits (if you have kids,
every 3 months the government sends you some money; if you have a wife, you
are able to add both incomes and divide by 2 which will usually allow the
highest earner to enter a lower income tax bracket, etc...).

And then there is the fact that I believe my government is spending a huge
amount of money in the wrong way. But with regards to voting, I seem to be in
a minority. I can't change the system with my votes.

I will be looking to emigrate from Europe and to pay tax in another country. A
country with a much lower maximum income tax bracket (37% above ~115.000 EUR).
This compared to 52% when earning above ~67.000 EUR in The Netherlands.

~~~
mbroncano
Sorry to rain in your parade, but I paid taxes in both NL and US (for the same
job and status) and once you consider the extra burden in the US (health care,
personal transport, insurance, property taxes if you own a house ...) it
amounts to pretty much the same thing, probably less.

And obviously without any public service to justify it.

~~~
wsc981
I ain't going to the US. I will emigrate to a developing country but with good
public healthcare. Everything (electricity, public transportation, housing,
food) will be a lot cheaper as well. So both lower taxes as well as lower
costs of living.

~~~
skuzye
Don't forget to factor that in lots of developing countries your salary will
probably be a lot less too.

Edit: I feel like I should expand here. I live in São Paulo, Brazil. Rent is
through the roof if you want to get two work in less than 1 hour. The goods
are very expensive, everything is taxed 100% when imported, plus there are a
lot of taxes added to the local products price.

I have a good salary for the place and even so, if my wife wasn't working we
wouldn't be able to afford our two bedroom apartment within a 30 minute
commute to the city center.

~~~
wsc981
Yep, but I aim to get a well-paying remote job, hopefully through Toptal.
Currently I am preparing for the interview with Codility.

------
saosebastiao
One of my favorite anecdotes about the government in the US is the TRAX system
in Utah. It was initially built under the support of a tiny liberal core of
SLC combined with the promise of the winter olympics. But they did something
unheard of in the US: they 1) designed it well, addressing real transportation
needs, without any frivolous details, shady contracts, or massive stations
named after politicians, 2) they built it extremely quickly and under budget,
and 3) once built, they continued to operate it with high service levels and
low costs.

And because of it, something else happened that was unheard of in the US:
_Republicans voted insatiably for more of it_. Every single vote they put on a
ballot was thrusting the system further and further into red country...places
where republicans win over democrats with 90% of the vote or more. And they
all passed.

This is why I can't get on board with any part of the left in the US, despite
ideologically identifying more with the Western European green parties. The
left wants more, but won't address the gigantic fucking elephant in the room,
the fact that we suck at government and aren't doing anything to fix it. And
because of it, I don't blame the right at all for feeling the way they do. The
government sucks, and they have never experienced anything better, so why
should we vote for more of it? Fix the government and they'll be begging for
more.

~~~
BurningFrog
Utah is special: [https://www.bloomberg.com/view/articles/2017-03-28/how-
utah-...](https://www.bloomberg.com/view/articles/2017-03-28/how-utah-keeps-
the-american-dream-alive)

~~~
germinalphrase
It's an interesting article, but left me feeling that what's "special" about
Utah is less the qualities or decision making of their government then it is
the willingness of the population to make an active effort to help people in
their community on a purely voluntary basis.

Everywhere I've lived has really felt like the opposite - you're on your own.
Of course, a strong social support network works better - but we don't have
that kind of culture in the US.

------
uiri
_If this were a suburb of Stockholm or any other European city of 250,000,
there would be train service and bus service several times an hour. These are
the choices Europeans have that we don 't, because they devote more of their
income to collective goods._

I'm really not sure what America spending their infrastructure tax dollars on
highways and roads instead of buses and trains has to do with tax rates.
Sweden could have lower taxes and still spend their money better.

It would be much more apt to compare Madison with e.g. Malmo or Uppsala and
middle-of-nowhere Wisconsin wilderness with the same in Sweden. I'm sure he'll
find remote areas of Sweden just as inaccessible as the remote areas of the US
he is using as a comparison point.

~~~
kungtotte
I'm from Sweden, and I've visited the US several times, and one of the first
things I noticed was the poor state of the roads.

I've been to Seattle (didn't drive, but rode along in cars a couple of times),
and NYC (drove from downtown Manhattan to middle of nowhere Pennsylvania and
back to Newark). Even the freeways around NJ and PA were in a sorry state.

So if the US spends money on their roads, I'd hate to see what happens with
things they don't spend money on...

------
avelis
NPR's Planet Money did a awesome segment on a trial program in California to
pre-fill out your tax returns. I recommend the read or a listen to the
podcast.
[http://www.npr.org/sections/money/2017/03/22/521132960/episo...](http://www.npr.org/sections/money/2017/03/22/521132960/episode-760-tax-
hero)

The reception publicly amongst people in the trial program was that it was
very helpful. Hopefully one day we can see more states try this out for a
nationwide push in the future.

------
koenigdavidmj
Reiterating the point a few others have made, there are places in the US where
you have subsidized, frequently used ferries (Seattle area, for instance). The
ferries exist where the people exist.

But the American hostility to taxes is rooted in a pretty strong failure to
see their useful results. If someone is in California, paying nearly Europe-
level taxes, but don't have nearly Europe-level public healthcare, roads, and
transit, something's wrong.

------
hnaparst
The author is seriously mistaken. The total tax burden in Sweden is among the
highest in the world. To see how this works, suppose that an employer wants to
pay an employee $100. The first thing they have to do is pay the employer tax
of $31.42. Then the employee has to pay their income tax on the $100, which
can be as high as 55%. So of the $131.42, the employee gets $45. Then, they
can consume that $45, but for everything they buy, they have to pay 25% sales
tax. So of the $45, $9 goes to sales tax. So really, they get to spend $36 of
the $131.42. Really, the tax on income is about 72.58%. Some calculations put
it as high as 76%. Read skattebetalarna.se for details.

Basically, the government keeps all the money. Swedes have no money. I lived
there for 10 years. Swedes are always struggling paycheck to paycheck. There
is less income inequality than in the U.S. The medical system is very bad.
People have no desire to work because it is difficult to get ahead because of
the high taxes.

~~~
bjelkeman-again
That is misinformation. It doesn't work like that. You are taking the highest
marginal rate, and applying it to the full amount. The tax burden increases on
a higher income, but the the higher rates only apply to a portion of the
higher income.

The VAT isn't 25% on everything. 6% is on books, magazines and newspapers,
culture evens, national transport. 12% on food, restaurants, hotel and artwork
sold by the artist.

[https://www.verksamt.se/starta/skatter-och-
avgifter/moms/oli...](https://www.verksamt.se/starta/skatter-och-
avgifter/moms/olika-momssatser)

Effective income tax isn't as high as the picture you paint.
[http://www.economist.com/blogs/dailychart/2011/09/effective-...](http://www.economist.com/blogs/dailychart/2011/09/effective-
tax-rates)

~~~
hnaparst
I lived there for ten years. I ran businesses, paid taxes, and even filed
taxes for the companies I ran. It is not misinformation. What is
misinformation is Americans claiming that they know about what is going on in
countries they have never lived in.

------
utternerd
If you prefer more extortion, that's fine; stop pushing it on others. No one
is stopping others from voluntarily paying more in taxes if that's your
belief, but personally I'm tired of paying for wars, the slaughter of
innocence, police brutality, and a long list of items I'm told are all part
and parcel of living in a "civilized" society.

~~~
gahahaha
The more underfunded the government is, the less it can invest in schools,
mental health care, the environment, infrastructure, a competent bureaucracy
and so on. All things that are necessary for economic growth. Americans'
allergic reaction to paying taxes is just one more reason why the country is
circling the drain.

~~~
utternerd
"Competent bureaucracy" is essentially an oxymoron. "Things" necessary for
economic growth are infinitely more efficient when directed by the market, not
by forceful removal of my property for "them" to decide how best it can be
utilized. Why is my body (which extends to my means of production) not my own?

~~~
gahahaha
Competent bureaucracy is what they've got in Sweden. You obviously don't
believe public goods exists. That's stupid.

~~~
utternerd
Using the force of the state to further other's goals is something I am
entirely against because historically we can see how much damage it's done,
calling that stupid isn't constructive.

~~~
gahahaha
I don't feel the need to be constructive towards the whole taxes=theft crowd.
Engaging them would just encourage them.

------
cjlars
For those interested, here is a more comprehensive view of the difference
between taxation in Scandinavian countries and the USA:

[https://taxfoundation.org/how-scandinavian-countries-pay-
the...](https://taxfoundation.org/how-scandinavian-countries-pay-their-
government-spending/)

Sweden itself would be marked by much higher VAT/Sales taxes -- which collect
about 9% of GDP in SWE vs 2% of GDP in the US -- as well as higher income
taxes, collecting 22% of GDP vs 15% in the US. Also, despite much higher
corporate statutory tax rates, the US does not raise a larger % of GDP from
corporate taxes. I was also surprised to see the top income tax rate in SWE
phase in at only 1.5x the median income vs 8.5x in the USA. They also have
higher income taxes on middle and low earners. Because of this, more of the
difference in total tax burden seems to fall on the middle class than is
commonly thought.

------
guelo
In my mind there are two main problems with US culture that cause government
dysfunction:

1) The mixed demographics means racists don't want to have their taxes going
to provide services for " _those_ " people.

2) Uncritical reverence of the military means they get too much funding.

~~~
true_religion
Heh. In the UK people are mostly complaining about chavs receiving welfare
even though these are essentially the same ethnic group and in some cases just
the poor branch of the family.

~~~
ionised
That's because the UK is a society rife with systemic classism and hereditary
privilege.

It breeds shitty attitudes.

------
dangjc
If you count expenditures Americans have to pay to private companies that
Swedish people don't, eg thousands of dollars for health care, $100k+ for
college, day care, private transport, etc, I think you'll find Americans pay
the same or more just to get by in life. Whether it goes to the government or
to big corporations, that money still leaves your bank account.

~~~
hnaparst
You might try living in Sweden before making such pronouncements.

------
T-A
This article is disinformation.

> It turns out the average Swede pays less than 27 percent of his or her
> income in direct taxes.

I have no idea where this number came from. Maybe you can get it by including
children and others who are not part of the workforce. The average income tax
in Sweden is 43%, according to [1], which looks a lot more plausible; county
taxes alone (paid by all workers) are in the range 30-35% [2], and that does
not include mandatory payments for social security etc, which are handled by
the employer. You get to see the full impact as a business owner. Sole
proprietors end up forking over roughly 2/3 of their bottom line.

Living off investments? Capital gains tax is 30%, independent of holding
period, and even currency exchange is taxable (which is a problem because the
chronically falling Swedish krona makes it a "gain" to just hold e.g. dollars
or euros in an interest-free trading account).

> Tax forms come already filled out

If you are a salaried employee living and working in Sweden, don't run a
business (or even have an occasionally income-generating hobby) and have no
investments, then you can probably just sign the thing and be done. In that
case, the government knows everything about your finances, and if you think
that's a good thing... good for you.

> There is no property tax

The "conservative" government which abolished it is gone, the current
socialist one is raising taxes again and is widely expected to eventually
reinstate a wealth tax, which would also act as a property tax unless property
is explicitly excluded - which is unlikely, given years of hand-wringing over
the high level of real estate prices and related household indebtedness.

> Sales taxes in Sweden are higher — but less noticeable

Sales taxes in Sweden are insane: if you sell a good for X, you need to add
25% of X to the price and hand it over to the Swedish state. It's "less
noticeable" by law, just like the mandatory contributions to social security
handled by employers, because it would be unwise to keep reminding tax payers
how much they are being charged. If you consider this a good thing... I
consider you a paternalistic jerk.

> We get cash instead of deductions

This is just plain false. Deductions for home improvements, recycling,
investments in special business categories, depreciation of equipment for
hobby or business use... I could go on. It's all there. My most benevolent
guess: the author doesn't know Swedish and simply doesn't have a clue.

> High taxes give me more choices and freedoms

Author is a socialist. He may not be wrong on a personal level - it is quite
possible that he, in particular, gets more from the system than he pays into
it - but that simply means that others are being made to pay for his choices
and freedom.

[1] [https://www.va.se/nyheter/2016/12/29/siffrorna-avslojar-
vi-s...](https://www.va.se/nyheter/2016/12/29/siffrorna-avslojar-vi-som-bor-i-
norden-betalar-mest-skatt-i-hela-eu/)

[2] [http://www.scb.se/hitta-statistik/statistik-efter-
amne/offen...](http://www.scb.se/hitta-statistik/statistik-efter-
amne/offentlig-ekonomi/finanser-for-den-kommunala-
sektorn/kommunalskatterna/pong/tabell-och-diagram/totala-kommunala-
skattesatser-kommunvis/)

~~~
ionised
> Author is a socialist.

And? It's not the dirty word you think it is.

------
mbroncano
One of the most important moments during the political year in The Netherlands
is 'Prinsjesdag'

 _> After lunch, the Minister of Finance proposes the next year's national
budget [...] The presentation is followed by a cycle of parliamentary debates
on the budget. [...] It is the most important moment for parliamentary policy
making, as MPs can amend the budget to finance specific plans._

The government also provides material for schools to present to kids during
class [2] where it's usually discussed the different budget chapters.

[1]
[https://en.wikipedia.org/wiki/Prinsjesdag](https://en.wikipedia.org/wiki/Prinsjesdag)

[2]
[https://www.rijksoverheid.nl/onderwerpen/prinsjesdag/inhoud/...](https://www.rijksoverheid.nl/onderwerpen/prinsjesdag/inhoud/lesmateriaal)

------
niceperson
Well, it doesn't change the fact that they're still taxes. Just because the
guy who robs you offers you 10% of what he robbed from you doens't mean he's a
source of income or good in any manner.

------
redsummer
High taxes are only happily paid in a homogenous society. The tax you pay goes
to people like you, who go through the same kind of life as you. In less
homogenous societies, the thought of the taxpayer is "that money is going to
be wasted by someone who is not like me"

