Germany's tax rates are quite high. Germany's personal income tax is so high that a year's pre-tax income is $100,000 and only $50,000 after tax. Of course, the welfare in Germany is very good, medical care is free and hospitalization costs only 10 euros per day. High welfare must be matched by a high tax burden, otherwise the national financial system will be unsustainable. Many European countries have relatively high levels of benefits and tax burdens, which has both advantages and disadvantages. It is true that wages in Germany are not low before taxes, but they are really not high after taxes. A large amount of income becomes government tax and personal disposable income is significantly reduced.
However, on the other hand, high welfare can greatly reduce personal expenses, such as education and healthcare. In terms of the average salary level of Germans, the starting point of personal income tax in Germany is very low. According to the German Federal Labor Office, the average monthly salary of German workers in 2017 was 3,209 euros, compared with 3,339 euros in the Midwest and 2,600 euros in the East. The average annual salary of a German worker, based on a 12-month year, was 38,508 euros. But Germany's personal income tax threshold for 2018 is €9,000 a year.
Despite the exchange rate problem, Germany's personal income tax threshold remains low. In 2017, the average German salary was €3,209, or €38,508 a year, but the starting point for personal tax in Germany in 2018 is €9,000. In other words, if the annual income is about 23% of the average salary, you have to pay tax! Looking at China, the tax threshold is 5,000 yuan, and annual income is 60,000 yuan. in 18 years, the average wage in China was around 68,380 yuan, which means that Chinese people don't have to pay taxes until they reach 88% of the average wage!
In other words, personal income tax will be paid when the current year's income is only 23% of the average wage of all German workers. German residents have a high tax burden, and the difference between pre-tax and after-tax income is huge. If you like to control your income, working in Germany can be painful. This is because at first glance, the salary is high, but the salary is much lower than expected. There are two sides to everything. High benefits mean less risk for the average person, and high taxes lead to significantly less disposable wealth.