During tax season Americans like to console themselves about the money they fork over to the goverment by remembering that it could be much worse. After all, the "U.S. has one of the lowest tax rates among developed countries," writes Steven Hill for The Atlantic. But the solace American taxpayers find in comparison needs to be re-evaluated, according to Hill.
"On the one hand, yes, we pay less. The share of our total national income captured by the government in taxes is small compared to most developed economies. On the other hand, we get less. Americans pay out nearly as much as some European countries, Canadians and the Japanese. But we receive a lot less for our money," wrote Hill.
In Sweden about 56 percent of a person's paycheck goes to taxes. However, in return Swedes receive quality health care, child care, a generous retirement pension, free college education, job retraining, paid sick leave, paid parental leave (after a birth or to care for sick children), ample vacations, affordable housing, senior care and more.
"I am very happy to pay high taxes because I know I am getting value for the money later on," said Valentina Valestany, a 39-year-old legal adviser from Sweden, in an interview with The Guardian. She was particularly pleased with the education her teenage daughters are receiving. "Lunches are free. It was no problem getting in. My daughters receive a very good education and they have great teachers."
But American's aren't paying that much less than Swedes, according to a new report from the Tax Policy Center in Washington, D.C. In 2012 the top combined U.S. rate on wages was 47.6 percent, higher than at any time since the top federal rate dropped below 50 percent in the mid-1980s.
"In order to receive the same level of benefits as Swedes, Americans have to fork out a lot more in out-of-pocket payments, in addition to our taxes," wrote Hill in his Atlantic piece. "These payments often are in the form of fees, surcharges, higher tuition, insurance premiums, co-payments and other hidden charges. Whether it's in the form of a tax, fee or surcharge, either way it comes out of your pocket. Yet that fuller picture is not considered when calculating who pays the most."