Name: How Sweden Balances High Taxes And Growth
Uploaded: 2021-02-21T02:30:41.000Z
Duration: 8 min 21 s
Description: VoiceTubeの動画で発音を聞きながら英語表現を覚えよう！学べる英語：

様態の副詞

They're a big political issue, especially now.

New York congresswoman Alexandra Ocasio-Cortez has proposed a 70

percent marginal tax rate on wealthy Americans as part of her

Today is the day that we truly embark on a comprehensive agenda

of economic, social and racial justice in the United States of

It sounds like a big number but there's another country where

This Nordic country is often known for its picturesque landscape,

ice hockey prowess, and companies like IKEA and Volvo.

But, Sweden is also known to have some of the highest taxes in

the world and without costing its economy.

So how did a country with fewer than 10 million people pull it

He's a professor with the Department of Economics and Business

Economics at Aarhus University in Denmark.

The short version of the story is that Sweden and the other

And they have fairly good economic performance.

The simple explanation is that you cannot judge the effect of

taxes without knowing what they are financing. I mean the Nordic

countries, a large part of taxes goes to finance

education, health and other things, in various ways actually

support the labor supply and high employment rates.

In other words Sweden has been able to support both high taxes

and high economic growth because of how it spends those taxes.

Tax revenue supports generous childcare programs, gives

employees vast leave of absence opportunities and helps offer

Those programs in turn help make Swedish citizens more

employable. They also don't have to ration big portions of their

paychecks or things like daycare or student loans.

The average tax wedge for a Swedish worker with an average income

is about 43 percent, but the income tax can go as high as 61.85

percent depending on how high the income is. And

It's the difference between what a worker pays in total taxes and

Basically the difference between your take home pay and your

It's also a measure of how taxes can drag down employment.

Sweden has had pretty steady GDP numbers since its recession in

2012 and during the 2008 crisis, and even before that Sweden

suffered a severe recession back in the 1990s. And prudent

reforms to its banking system and regulations helped it bounce

back in a big way through the next few decades.

Sweden now has the 12th highest GDP per capita in the world.

In fact other high tax Scandinavian countries like Norway and

Denmark also ranked in the top 10 countries when it comes to GDP

Sweden's tax system has, of course, income taxes.

contributions. And the end of the day, it's not so important

whether the taxes are collected in one way or another.

They're still a wedge in the labor market creating a difference

between the cost of labor to the employer and the take-home wage

after taxes and all social contributions to the workers.

So for example a single worker making roughly seven hundred

twenty six thousand Swedish krona a year in salary or about

dollars would have a marginal tax wedge of 69.7

percent. That percentage is nearly what Alexandra Ocasio Cortez

But she's saying that this tax rate would apply to those making

They pay for things like childcare, health care and education.

But if you look at an average family, yes they pay

taxes. But then on the other hand they don't have any

expenditures on education for the kids and so on.

So they give out a lot of money on one hand, they also get

appreciated services back. Of course, nothing is perfect

but they still get value for money. And you can also see that

politically there's very broad support for maintaining this system.

But it's up to Swedish politicians to decide how to spend tax

He's a senior fellow at the Cato Institute.

We've got more revenue from the people so the politicians

can put it to work where they find it most of interest to people or to themselves.

You pay when you work and it's distributed to

yourself when you have children or when later on when you need

So it's more a redistribution within the lifecycle of people,

more than redistribution between different groups of people from

So what's the big deal against high taxes?

In Sweden, they get you top-rated health care and higher

education that doesn't put people in six figure debt.

for lower income taxes say they stifle economic growth and

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How Sweden Balances High Taxes And Growth

appreciate

basically

average

revenue