Spain vs the US: the tax cost of a 30,000 salary
On a 30,000 euro salary, Spain takes 24,000 in taxes versus 7,000 in the US. Who pays for the state?
English · Original discussion in Spanish · Published
A 30,000 euro salary leaves 24,000 in taxes in Spain
Spain doesn't have a wage problem: it has a state problem. For a 30,000 euro salary, the tax cost in Spain comes to around 24,000, versus 7,000 in the United States. A difference of more than 300% with the same labor bill.
Some argue that healthcare and education here are "free". Except someone pays for them: the worker, through withholdings and social security contributions. What's up for debate is how much that benefit costs and what share falls on the wage earner.
The underlying question leads to the usual place: the employer isn't the only one exploiting. For one school of thought, the biggest extractor of the value of work is the state, with a structure some put at more than three million public employees and half a million politicians. Disputed figures, but pointing in the same direction.
Another reading points out that cutting taxes doesn't guarantee better wages: if labor is cheap, the company keeps the savings. But if hiring is so expensive, job creation becomes almost impossible.
As long as the tax burden doesn't come down, net wages will keep losing ground to the US. Unless the state slims down. Or the worker accepts living with less, which doesn't seem to be the plan.
Spain doesn't have a wage problem: it has a state problem. For a 30,000 euro salary, the tax cost in Spain comes to around 24,000, versus 7,000 in the United States. A difference of more than 300% with the same labor bill.
Some argue that healthcare and education here are "free". Except someone pays for them: the worker, through withholdings and social security contributions. What's up for debate is how much that benefit costs and what share falls on the wage earner.
The underlying question leads to the usual place: the employer isn't the only one exploiting. For one school of thought, the biggest extractor of the value of work is the state, with a structure some put at more than three million public employees and half a million politicians. Disputed figures, but pointing in the same direction.
Another reading points out that cutting taxes doesn't guarantee better wages: if labor is cheap, the company keeps the savings. But if hiring is so expensive, job creation becomes almost impossible.
As long as the tax burden doesn't come down, net wages will keep losing ground to the US. Unless the state slims down. Or the worker accepts living with less, which doesn't seem to be the plan.
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Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (19 replies).
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