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by a-saleh 3114 days ago
so .. 59% tax then?
1 comments

You can't just add the percentages for income tax and VAT. If you were to combine a 40% income tax and a 19% VAT, you'd end up with 49.6% effective tax. (1-(1-0.40)/1.19)

(I'm not arguing that this naive computation makes sense, you pay different VAT rates or no VAT at all, depending on what you buy. I don't think you have to pay VAT on rent, which is a significant part of the income for many people and reduced VAT on most groceries)

For the middle-class the estimates are that about 8% of your income goes to VAT.
Thanks! My brain kinda failed me there :)