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Tax War – Britain Against The World!

Ever wonder if you get taxed more than people in Europe and North America? A new report just published gives us more information.

What the report appears to have done is looked more closely at exactly how much tax people pay in different income brackets…£25,000, £40,000 and £100,000. It has then compared the numbers against countries such as Germany, France, Sweden, and the United States of America.

Interesting if you ask me, although there is one place we don’t need to compare of course…Monte Carlo, where many of the UK super rich go to enjoy a “tax free” lifestyle while still enjoying all of the benefits of being a British citizen and running businesses within the country.

So let’s start with those high earners, and this includes high earning contractors remember. Right here in the UK someone earning £100,000 gets taxed around 35% of their income. This is roughly about one-third of their pay.

The USA, Spain and Australia are pretty similar to the UK for this income bracket. However, in Germany you have to pay a bit more to the tax man or woman with 38%, and in Ireland you are expected to give up 41% of your pay packet.

That is nothing compared to France though, where people earning £100,000 a year are expected to hand over 59% in tax. This does include a large amount of pension contributions I’m told, and I’ve also heard that many French workers have good contractor accountants.

There has been talk in the past of bringing the European Union together in a single tax policy, although Britain would no longer be part of that. I’m sure that many French people would like to join up with the likes of Spain and only pay 35%, but then they might not have as much money for retirement.

Workers in France are also taxed significantly more when it comes to the lower income brackets, with someone earning £25,000 a year paying 31% in tax and £40,000 a year 41% in tax.

Compare this to the UK where a £25,000 income means you pay 18% and a £40,000 income is 25%, and you can see why not many Brits decide to relocate to France.

Ireland are also easier on their lower income workers, with a £25,000 salary meaning you have to pay 15% tax and £40,000 worth of income giving you a 25% tax bill.

What the report shows is that the tax rate is quite similar between most European countries in the £25,000 and £40,000 income range, although Sweden do tax 22% for a £25,000 income, while in North America, the USA comes in at 20%.

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