Friday, July 17, 2009

Israel thinks their taxes and healthcare are high?

Updated 7/20/09.

Americans are still suffering from a "something for nothing" syndrome when it comes to public services. They want First World services and protections, but constantly complain that Europe and the rest of the First World tax their citizens too much and that Americans shouldn't have to pay what the rest of the First World pays for services.

This can't last, of course. The fact is the American government is beyond bankrupt due to refusal both to pare back unnecessary expenses and to step up to the plate and provide First World health care, which is such a drain on private businesses that the cost is destroying the American economy.

Israelis, too, complain about their taxes - perhaps with good reason, but after doing the math for my taxes and healthcare, below, I'm thinking not. Israeli of course has national health care, and recognized that medical care is a basic human right, like all other civilized countries. (America is not a civilized nation, believing not that all men are created equal, but in "survival of the fittest" Darwinist economic theory). Israel takes its social contract with its people seriously, as well it should. Doing so, however, does cost money - less money, it turns out, that we here in America are being fleeced by for-profit healthcare.

Arutz Sheva Online
Published: 07/15/09, 5:41 PM / Last Update: 07/16/09, 7:07 AM
Study: Israelis Pay Majority of Salary to Taxes
by Hana Levi Julian

(IsraelNN.com) A Jerusalem think tank has officially confirmed what every Israeli worker already knows: the government takes a bigger bite of his/her paycheck than the employee him/herself.

A study published by the Jerusalem Institute for Market Studies (JIMS) on Wednesday -- proclaimed by JIMS as "Israel Tax Freedom Day" -- said that almost two-thirds of Israeli salaries actually go to pay some form of government tax...

...The rate is calculated by taking the ratio of total taxes paid by the Israeli population over Israel's net national income (NNI), JIMS says. The calculation included all taxes paid, including income tax, VAT, local taxes, import taxes, car and fuel taxes, and service taxes...


Most Americans don't really have much idea what they are paying in taxes. Sales tax only became deductible on the Federal Return a couple of years ago, and few people have the discipline to enter every receipt into a spreadsheet or program like Quicken to see how much they're spending in taxes. If you buy Alcohol, some states don't charge sales tax (ours only started doing so this past April) but all states charge a wholesale "sales" tax - which I had to call around to find out. It gets passed along to the customer, so we're all paying it and should take it into account. This has been an interesting experience.

Similarly, gasoline receipts do not print the amount of tax included in the bill, so persons in each state have to do some calling around and guess, based on the number of gallons they bought each week for every car. I may do that next year, but I'm not doing that right now.

No, this year I have decided to see if it is worthwhile to itemize sales taxes (including alcohol). So I have been entering every receipt to see how it shakes out. Most food in our state is not subject to sales tax, but soda, chocolate, and prepared items at the deli are all taxable, amoung others. Of course eating out is taxed, too. Some "services" are not - but auto repairs and maintenance are, for example. You have to make yourself familiar with the tax laws in your state and pay attention to what is on the receipts you receive (which they are required to give you if you ask, fortunately).

So far this year we've spent $165 in sales taxes, $835 in local and school taxes, $793 in property taxes, $2730 in state income taxes, $535 in federal taxes, $2100 in social security tax, $250 in self employment taxes (me), $185 car tax, and an unknown amount of taxes included in our utility bills, something else I plan to track next year. At the end of the year for previous tax returns I have gone through and added these up all at once, and they usually come up to around $600 in taxes on our utilities.

The grand total, then, for the first half of the yer plus half of July for 2009 is about $8200. That's $1262 dollars per month in taxes alone, not to mention other mandated monthly expenses, and not including private health insurance.

Auto insurance is required by law in our state (and most states) and has been $603 so far this year. Likewise everyone with a mortgage is required to carry homeowners - $352 so far this year, and your mortgage company also probably charges you PMI (private mortgage insurance) - $332 year to date. (per Quicken)

And then there's the biggie - for-profit private health insurance policies. The total that is withheld from my husband's paycheck is $451 per paycheck, twice a month, making our total out of pocket amount to be $6314 so far this year (14 pay periods thus far). But wait - that is not the total cost, because his employers pays half. That means the real cost of private health insurances (medical, dental, vision) has been $12628.00 so far this year, or about $972 per month each for us and for his employer. (The grand total for this year will be in the neighborhood of $25,256 out of pocket just for premiums alone. If he lost his job, we would have to cough up that much ourselves, of course. )

I don't believe Israelis pay anywhere near that for healthcare.

And, more to the point, $8200 dollars in taxes, $1287 for required auto and homeowners premiums, and $6314 for health insurance brings the grand total to $15,801 in total expenses for taxes and insurance. Setting aside the auto and homeowners, the total burden for taxes and healthcare have been $14,514 so far this year (just our personal expense alone, not counting the employer's half).

That's $2233 per month, and my husband's gross pay for one paycheck each month is about two hundred dollars LESS than that. So, presuming we are a typical American family, we are paying MORE than 50% of our wages in taxes and healthcare, and STILL have to pay large co-pays for office visits, prescriptions, and eyeglasses (if you can afford them. If not, you go without).

So Israelis should hardly complain. Their country is a First World nation that takes care of its people's basic human rights. Americans believe in fleecing the sick, not helping them.

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