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Of monsters and presidents | 30 comments (30 topical, editorial, 0 hidden)
Re: Of monsters and presidents (none / 1)
If the band is sufficiently narrow, then talking about marginal tax rates becomes largely a red herring. To take the extreme example, it is possible to imagine a 200 % marginal tax in a band precisely one € wide (I know that this example is ridiculous, but I hope it illustrates the point). The bandwidth is needed if you want to make an apples-to-apples comparison across borders (along with much else, as noted upthread).

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue May 20th, 2008 at 04:25:46 PM EST
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Re: Of monsters and presidents (none / 0)
The band is narrow in case of single income households. In case of double income households it can be large, because income tax billing can be done together for married people, while social insurances are bound to the working place.
That means if your spouse earns significantly more than the health insurance cap, for your part of the household income the marginal tax rate maybe (depending on how much your spouse is above the cap) from the first Euro to the cap (43.200 EUR) at this marginal rate.
For the calculation of the marginal tax rate I have included employer's contribution to the social insurances.

As said above, the cap is not simply a cap. You can leave the public health insurance if you earn that much, which is way cheaper. So a single with gross income of 43201 EUR, can end up with 200 EUR more each month than a person with an income of 43199 EUR.

Der Amerikaner ist die Orchidee unter den Menschen
Volker Pispers

by Martin (weiser.mensch(at)googlemail.com) on Tue May 20th, 2008 at 05:16:43 PM EST
[ Parent ]
Re: Of monsters and presidents (none / 0)
With the cap and private insurance are different values, I just found out. The cap indeed is 43200 EUR, but the possibility to leave the public health insurance system only starts at 48150 Eur.
However, I think the general point is clear.

Der Amerikaner ist die Orchidee unter den Menschen
Volker Pispers
by Martin (weiser.mensch(at)googlemail.com) on Tue May 20th, 2008 at 05:45:56 PM EST
[ Parent ]
Re: Of monsters and presidents (none / 0)
I'm not sure I understand. What does the cap do?

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed May 21st, 2008 at 06:28:25 AM EST
[ Parent ]
Re: Of monsters and presidents (none / 1)
Above a certain income, health insurance payments are fixed. It used to be identical with the limit above which you could choose private health insurance, but the Schröder government raised the latter.

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Wed May 21st, 2008 at 07:31:25 AM EST
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Of monsters and presidents | 30 comments (30 topical, 0 editorial, 0 hidden)
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