alt Hacker NewsI think you should also mention the ~17k Euro social contributions that your employer pays on top, which could otherwise be part of your salary. Then it is actually pretty much 50%
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To be fair this is the case in the US, too. Your employer has to pay a bunch of taxes on your behalf.
People think the US has a low tax burden, it does not. Even in "low tax" states like Texas. And even more so when you consider "unofficial" taxes.
My health insurance surely costs my employer ~1500 dollars a month. That's quite a big chunk of paycheck that I don't get to see. But that's how it works in the US. And that's just my employers part. I, of course, have a deductible, copays, premiums and all.
There are two terms in German salary:
"visible" and "invisble" Brutto. The one is without "contributions from employer", which is a lie anyway since an employer makes a total comp perspective and he for sure includes his "contribution" into that
US also has federal employer-paid payroll taxes the employee usually doesn't see or think about.
For a $110k salary the federal employer paid payroll taxes would be almost $8,500, or ~7.69%. They would also pay some amount to unemployment insurance, but that rate depends a lot state by state.
I realize that's less than the Euro taxes, just wanted to share so everyone is aware of these often forgotten US taxes when compared.
Correct: if one takes as basis not the Bruttolohn but the total cost for the company, the sum of taxes and mandatory social contribution can very well reach the half of the income. The method of splitting employer-side and employee-side deductions seems just there to hide this fact.