There are those in America who see great inequity in our system, its rigged, the rich don’t pay their fair share, inequality is the culprit, our social safety net is inadequate.
What they don’t say much about is taxes, except for implying more stuff can be free for everyone if only the wealthy pay more. Guess what, it doesn’t work that way … anywhere. What may appear free to the end user is buried in everyday taxes of one kind or another. Think gasoline and VAT taxes.
What actually happens is citizens turn over close to half their income to government and then trust their bureaucrats and politicians will redistribute their money in their best interest.
So, do you want to go from 27% to 46% in total taxes to get more free stuff?
The Organization for Economic Cooperation and Development (OECD) released its annual Revenue Statistics report this week, and France topped the charts, with a tax take equal to 46.2% of GDP in 2017. That’s more than Denmark (46%), Sweden (44%) and Germany (37.5%), and far more than the OECD average (34.2%) or the U.S. (27.1%, which includes all levels of government).
France doesn’t collect that revenue in the ways you might think. Despite the stereotype of heavy European income taxes on the rich, Paris relies disproportionately on social-insurance, payroll and property taxes. Social taxes account for 37% of French revenue; the OECD average is 26%. Payroll and property taxes contribute 3% and 9%, compared to the OECD averages of 1% and 6%.
Then Europe adds a regressive consumption tax, the value-added tax. In France, VAT and other consumption taxes make up 24% of revenue, and that’s on the low side compared to an OECD average of 33%. Consumption taxes often fall hardest on the poor and middle class, who devote a greater proportion of their income to consumption.
Wall Street Journal, All the Taxes in France, December 7, 2018