> extremely high taxes
I always find this funny. Brazilian taxes are nowhere near what I would say “high”. I pay about twice as much out of my compensation as I would pay in Brazil, and that would be as if I did zero tax optimisation back then.
> extremely high taxes
I always find this funny. Brazilian taxes are nowhere near what I would say “high”. I pay about twice as much out of my compensation as I would pay in Brazil, and that would be as if I did zero tax optimisation back then.
I can second this.
Compared to many countries Brazil doesn't have such high taxes (I'd say that if you work remotely for a company outside of Brazil, you'll probably have much lower taxes compared to almost any other country -- working locally the difference isn't as big, but you have higher taxes in many other places).
What it really lacks is access to capital (which is the real "mojo" of the US compared to the rest of the world).
Also the bureaucracy, employee rights, etc.
Incorporating and getting a functional business entity in Brazil is harder. In USA I literally do in 5min online including bank account. In Brazil they are taking out microscopes to verify your signature on the paperwork matches.
And in the USA if you have one bad employee, just fire them any time. In Brazil for better or for worse nowhere near as easy. Obviously better for employees but businesses don’t like it because you can get stuck with a employee dragging down everyone unless you pay them a years salary etc.
> Incorporating and getting a functional business entity in Brazil is harder
It’s still something you can do in less than a month. That’s nothing compared to the life of a functional enterprise.
For you to have to pay “years of salary” the employee must have been with you for a very long time - as in decades. Considering most companies don’t live to 2 years, the odds of it happening to you are very slim. Labor laws exist to protect the weak part against the possible abuses of the company. You must agree the harm a company can do to its employees is far greater than what an individual employee can do to a company. And this is why unions exist: because collectively is the only way the employees have teeth.
Parent was referring to the cost of hardware. I've had colleagues from brazil visit the US and go absolutely crazy at best buy to grab as much hardware as they could (laptops, nintendo switch, etc), because it's prohibitively expensive for them to buy that at home.
It's not "prohibitively" expensive if they managed to pay for flights to the US, hotels and then buy several pieces of hardware. They definitely had more than enough money to buy whatever they wanted in Brazil. It is, however, much more expensive than it should be, which leaves a bad taste in our mouths and means people will find other ways of acquiring some items.
It was a business trip, but yeah.
Yeah. Brazilians go nuts when they see US prices. Every family member who travels to the US is showered with purchase requests. Anything they manage to bring back without being taxed essentially receives a 50% discount.
As an employee: your taxes are not that high, but public services are terrible so most of middle-class ends up paying for the private alternative as well.
As a business owner: not so bad if you are a freelancing or just a few business partners providing some type of service, but terrible the moment you start considering employing other people.
> but public services are terrible
Have you seen the public services of countries with lower taxes? Their public hospitals?
> but terrible the moment you start considering employing other people.
Employing people isn't cheap anywhere (except, perhaps, in the US, where labour rights are kind of nonexistent)
I live in Germany. No such thing as public hospitals. And I pay close to 1200€/month in health insurance to the public insurance company.
I quick visit to the dermatologist to check for some tiny bumps that showed up in my forehead: 60€, out of pocket, because the insurer doesn't cover it.
Sad to hear about that. Ireland is much better in that regard - you can pay for private healthcare and it'll provide you a broader network, but you might as well go for public health, where you'll be prioritized based on how life-threatening is your condition.
Yeah, I make it sound worse than it seems. The problem of the public insurance is that you pay based on your revenue instead of your actuarial risk, so in the end it should be treated as an extra form of revenue tax. I could go for the private insurance if I wanted to pay less, but then I'd have to switch my kids to the private insurer as well.
All in all, my point was only that the amount of taxes that people pay and quality of services are not necessarily related. Germany has high taxes and expensive-but-adequate healthcare. Greece has high taxes and expensive-and-inadequate healthcare. Switzerland has low taxes and universal/cheap healthcare (max. $5000/year deductible, max charge per hospitalization of $700).
> you pay based on your revenue instead of your actuarial risk
That's how public health works. It's the same as mortgage insurance in Brazil (where I come from), which is mandatory, and, since it's mandatory, it doesn't consider actuarial risk.
Doesn't make it right or morally virtuous.
There’s nothing virtuous in letting people die because they can’t afford medication or healthcare.
BTW, “right” and “wrong” are human constructs, so you are totally free to organise a society around the survival of the richest. It’s just not a society you’ll like living in.
You took a false dichotomy and jumped to an absurd conclusion. It makes you seem more concerned about an ideological position than thinking the problem through.
There are other ways to properly fund universal healthcare that does not involve creating artificial taxes:
- Increase the actual income taxes.
- Policies that mandate the allocation of revenue from vice and environmental taxes (alcohol, smoking, gambling, fossil fuels) to the health system.
- Social security reform. Pensions should not be an investment, only insurance. Turn pensions into an UBI program that has a hard cap.
- Supplemental and voluntary insurance plans to work on top of the existing public network. This might be risky as it can introduce a dual-class system, but (a) it's already the reality in most countries anyway and (b) could be avoided if the system is built around a "cafe sopezzo" [0] mechanism (the priority is given to you when you use the service, but redirected to non-paying members for the months when you don't)
[0]: https://en.wikipedia.org/wiki/Caff%C3%A8_sospeso
Wow, 60 euro is cheap! Here in France it would be more like 150.
Ireland is in the same ballpark if you go private (insurance usually covers most of those €60).
If you go public, it’s free, but you’ll be in line based on the risk to your life, so it might be a long while. You really don’t want to check in to a public hospital and get an MRI right away because that means whatever you have is really, really bad.
> I pay about twice as much out of my compensation as I would pay in Brazil
Brazil relies heavily on indirect taxation, not income tax.
The average Brazilian effectively pays about *41.1%* of their gross income in taxes when all major taxes are included. (https://ibpt.org.br/brasileiro-trabalha-150-dias-por-ano-ape...)
They break it down as: roughly 15.2% from income-related taxes, 3.1% from property taxes, and *22.9% from consumption taxes*.
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And anyway, the real problem is that the burden of tax is way way higher for a brazilian than someone in the global north.
As a general rule, in Brazil only people who do qualified work can reach the (converted) 1000 USD threshold. People who spent years in university or trade school, and are either very good at their jobs or graduated in prestigious professions such as engineering, law or medicine.
Even if they were to pay no taxes, most 40-hour week professional programmers here would still earn, at the end of the day, less than a high-school diploma 20-hour worker in US. Let that sink in.
Now take into account that on average, out of those $1000, $400 becomes taxes: In practice, there are lots of qualified workers here who don't even make $8k/year after taxes...
And no, the lower living cost does NOT offset it. Imported/technology goods are disproportionately expensive relative to income since we receive in BRL but still pay the dollar price, if not higher, due to said consumption taxes.
It's nigh-impossible to have true disposable income that your average Joe or plain Jane can use to dedicate to homebrew their personal projects in Brazil. And when it happens, it tends to in software form, since software still is relatively cheap to make.
People whose income in the top 25% bracket here make less in dollars than US's bottom 25% bracket, simple as that.
This is, of course also true of many many countries, which is why you usually don't hear about the new cool tech from Nigeria, Brazil, Bangladesh, Congo, etc. The people who are qualified enough tend to leave the country for better conditions. Of course, I'm not saying it's impossible, but people get surprised, just as you can see in this thread.
Import taxes in Brazil are 60%, plus something like 18% on top of the product, shipping and the aforementioned import taxes.
The result is a nearly 100% tax on computers and consumer electronics.
One for you, one for the government.
And it's getting worse. Tariffs on computer hardware were raised only a few months ago.
60% (II) with 18% (ICMS) on top for a total of +88% are the import tariffs for individuals buying devices for personal use, and small businesses using simplified postal/courier regimes.
The tariffs for commercial importations are much lower and depend on the part. For SSDs, for example, II is around 10%. With other fees and ICMS, you're looking at around +60% total. Still high, but not nearly as high.
But large businesses would rather really prefer if you continued to believe they pay +88% just like you. That way they get to point at the government while keeping their fat margins.
> 60% (II) with 18% (ICMS) on top for a total of +88%
Nope. ICMS is calculated "por dentro". It's base / (1 - rate), not base * rate.
That's +95.12% tax. Also known as nearly 100% tax. One for me, one for the government.> The tariffs for commercial importations are much lower and depend on the part.
Fair point, but they're sure as hell not "much" lower. As you yourself noted, they are still high, and obviously those companies are going to want to add their own margins on top.
> But large businesses would rather really prefer if you continued to believe they pay +88% just like you. That way they get to point at the government while keeping their fat margins.
And, in the meantime, they help push for more "grift-friendly" politicians. For them, it's a win-win situation.
Doesn't Dell, HP, and a number of others have manufacturing in Brazil under better tax regimes for the parts? I remember one of the points of the Zona Franca de Manaus was that - build a factory and enjoy tax breaks mostly for your imports.
Apart from that, this is something that affects the HN crowd and almost nobody else.
For some definition of "manufacturing". More like final assembly. Brazil hasn't attempted to create its own computer technology since the military dictatorship. For example, there are no brazilian semiconductor fabs that would be even remotely competitive with the current state of the art.