I've just had a look at your tax rates, and it looks like you tax everyone. There is no tax free allowance, a single person earning up to $9700 has to pay 10% of tax on that. They wouldn't over here.
Your 22% tax rate cuts in at the equivalent of £32,357.
We probably do pay higher taxes, but it looks like people on the lower scale pay more in America than over here.
We don't pay significantly more at all, but your uber rich do pay significantly less.
I think I can speak for Linkat as well as myself when I say neither one of us are making judgements as to what system is "better, fairer, etc"
I started out just asking for info on where the money for "free healthcare" comes from, and the answer was as expected....taxes. The part you stated that isn't covered also comes from somewhere too. One way or the other, you're paying.
No issues with that, no thoughts of if it's good or bad. Was just curious how your system works.
As far as your example of a single person having to pay 10% tax on $9700, that can be a bit confusing if you're not familiar with the US tax system.
For a single person, that $9700 figure is the result after the standard deduction of $12,200 if you are single or married filing separately. A married couple filing jointly get a standard deduction of $24,400, and a head of household gets $18,350.
Those amounts change every year, going up a little.
So that single person, if they take the standard deduction, actually made $21,900, and is paying 10% tax of $9700 (or whatever the result was under $9700 after taking the deduction).
People have a choice to take a standard deduction or itemized deduction, whichever works out better for them.
Examples of itemized deductions are mortgage interest, property tax, state and local taxes paid, medical expenses, charitable contributions, etc.
In addition, we have a graduated income tax system. So if someone's adjusted income after deductions and exemptions was let's say $35,000, they would pay 10% of the amount up to $9700 ($19,400 for a married couple), and then pay 12% on the difference of $25,300, or $15,600 for a married couple.
The next jump up occurs after one ears over $39,476 for a single person ($78,950 for a married couple) and the amount over $39,476 ($78,950 if married) would be taxed at 22%
So, some who makes let's say $600,000 after all their deductions is actually paying 7 different rates, each bracket increasing as their income rises.
As you can see, it's not as simple as saying someone paid tax on $9700.