[paol]

You're apparently unaware that not all tax appears on your salary receipt. Employers have to pay 20% to SS, on top of the 11% that the employee pays. (This amount doesn't count toward your gross income for IRS purposes though, which is relevant to your point)

The distinction is largely a technicality, all the more because both parts of the SS contribution are paid by the employer directly to the state, but it does have one effect: because the 20% don't show up in the salary receipt, most portuguese people are, like you, blissfully unaware of what the real tax rate on their salaries is.

[marcocampos]

If companies all of the sudden didn't have to paid those 20% would I see that reflected on my paycheck? I bet you I wouldn't nor anyone else.

I've heard that falacy time and time again: "Oh, if I didn't have to pay so much taxes for each worker I could pay higher salaries."

[paol]

You're responding to a statement I didn't make. I just corrected the common misconception that the SS tax is 11%, it's not, it's 34.75% [0]

What would happen if those taxes were lowered is for economists to speculate, I'm not one (even then, as the joke goes, put a question to two economists, get three different opinions)

[0] This conversation made go check the exact values, you can find them here: http://www.economias.pt/contribuicoes-para-a-seguranca-socia...