At the $150k salary level, the following will also be provided as benefits before the $150k:
4) Short and long term disability insurance
5) Family leave
A gross salary of $150k is going to be more like $175k including those taxes and costs.
In California, on a salary of $150k, the net paycheck will be like $90-95k, or $80-85k if you max out your 401k contribution. (If you do that, your retirement benefits will be much more than you would receive in France.)
> A gross salary of $150k is going to be more like $175k including those taxes and costs.
So, I checked and indeed there is a small fraction of gross/super-gross difference in US salaries. But that should just be 6% total medical/medicare. Far from the 45% you often find in Europe.
> if you max out your 401k contribution
I don't think accounting for employee/employer triggered retirement contributions should enter the comparison here... Because it exists in pretty much every country, and it depends on what the employee wants to spend.
> If you do that, your retirement benefits will be much more than you would receive in France.
France has exactly the same as US 401k, since 1970, it's called a PEE. It's tax free and company contribution can go up to 3:1, it's limited to 25% of your total income though. There's also the more recent PERCO which is pretty much the same thing but can be cumulated, so you can go over 25% if you want.
> A gross salary of $150k is going to be more like $175k including those taxes and costs.
So, I checked and indeed there is a small fraction of gross/super-gross difference in US salaries. But that should just be 6% total medical/medicare. Far from the 45% you often find in Europe.
It’s 7.65% social security + Medicare, plus health insurance, plus parental leave. On average, employers contribute $14,000 for health insurance for a family: https://www.kff.org/health-costs/press-release/benchmark-emp.... For someone making $150k thats 9.3%. For the average worker with employer provided health insurance, that might be close to 20%.
> I don't think accounting for employee/employer triggered retirement contributions should enter the comparison here... Because it exists in pretty much every country, and it depends on what the employee wants to spend.
Defined contribution accounts are one of the pillars of the UN model for pensions. Many European countries (U.K., Germany, Sweden, Netherlands, Norway) rely on them as an essential part of the overall retirement system. (Basically, they impose a lower retirement insurance tax and let you invest the money yourself.) So it should definitely be included.
> France has exactly the same as US 401k, since 1970, it's called a PEE. It's tax free and company contribution can go up to 3:1, it's limited to 25% of your total income though. There's also the more recent PERCO which is pretty much the same thing but can be cumulated, so you can go over 25% if you want.
My point is that the base Social Security payment, which is mandatory, will already provide you the same pension as you would receive in France. So you don’t have to decrease the 150k for 401k contributions to make the comparison even. But if you do account for 401k contributions, you’re going to get more retirement money than in France.
I'd like to point out that employer side taxes (all the things between "gross" and "super-gross" in your terminology) are very bad whether they are happening in France, the US or anywhere else.
The only purpose of levying them that way instead of as traditional taxes on the employee is to deceive employees as to their true effective tax rates. To the extent that these taxes are higher in France than they are in the US, it's only a demonstration that France's tax system is being more deceptive.
About France's tax system being deceptive, I would highlight that France makes it even more deceptive by having different regimes for different categories:
for instance, nurses or lawyers in France feel that the state levies from them a disproportionate amount of the super-gross (about 70%), and that these categories
(I took 2, but in fact this is true for all "independents" in France) pay more than
the rest of the population... which is not true, it is simply that the fraction of income that is levied as taxes is more obvious to those categories.
A regular employee does not even see most of these levies on their pay stub (it's called the "charges patronales", i.e. employers' contribution, but it really is a portion of wages that is socialized: this is money that belongs to the employee as wages, it's not something that belongs to the employer that pays it for the privilege of employing a person), and in reality what nurses/lawyers/independent perceive as outrageous taxation is just them paying "self-employment" taxes (as it's called in the US).
These taxes are there for good reason, but they are indeed masked from mere mortals.
It would do a world of good for these things to appear (by law) on pay slips, for it would make people realize that the many public services that seem to be free are in fact very much not free at all. Indeed these public services (which are pretty good in France, IMHO) cost an arm and a leg, yet the system is rigged to make them appear free. If that's not deception, I don't know what is :)
1) Retirement contribution 2) Medicare/health insurance contribution 3) Unemployment insurance contribution
At the $150k salary level, the following will also be provided as benefits before the $150k:
4) Short and long term disability insurance 5) Family leave
A gross salary of $150k is going to be more like $175k including those taxes and costs.
In California, on a salary of $150k, the net paycheck will be like $90-95k, or $80-85k if you max out your 401k contribution. (If you do that, your retirement benefits will be much more than you would receive in France.)