euronews.com
Seven European Countries See Drop in Real Post-Tax Income in 2024
In seven European countries (Italy, Estonia, Czechia, France, Greece, Belgium, and Spain), the average single worker's real post-tax income decreased in 2024 due to rising personal average tax rates exceeding real wage growth; this is attributed to increased social security contributions and the removal of tax allowances in some nations.
- Why did real post-tax income decrease for average single workers in seven European countries in 2024?
- Seven European countries experienced a decline in real post-tax income for the average single worker in 2024 compared to 2023. This is due to increases in personal average tax rates, which outpaced real wage growth in these countries. Italy, for example, saw a 7.5% rise in taxes despite a 2.7% real wage increase.
- What policy recommendations could mitigate future declines in real post-tax income caused by inflation?
- The discrepancies in real post-tax income across Europe highlight the impact of taxation policies. To mitigate future declines, indexing income tax and social security contributions to inflation could prevent "bracket creep," a phenomenon where inflation pushes taxpayers into higher brackets, effectively increasing tax burdens without a corresponding increase in real income.
- What specific factors contributed to the decrease in real post-tax income in Italy, Estonia, and Czechia?
- The decrease in real post-tax income in Italy, Estonia, Czechia, France, Greece, Belgium, and Spain resulted from a widening gap between wage growth and the rise in personal taxation. In Italy, increased social security contributions significantly contributed to this, while in Estonia and Czechia, the removal of tax allowances and higher social security contributions were key factors.
Cognitive Concepts
Framing Bias
The headline and introduction highlight the decline in real post-tax income in seven countries, setting a negative tone. While the article later discusses countries with increases, the initial framing emphasizes the negative aspect, potentially shaping reader perception to focus more on the decreases than the overall picture. The article also features prominent mention of a critic's accusations of inflation manipulation in Turkey, potentially undermining the positive data presented for that country.
Language Bias
The language used is generally neutral and objective. However, phrases such as "significantly higher real post-tax incomes" and "sharply by 7.5%" could be considered slightly loaded, although not excessively so. More neutral alternatives might include "substantially higher real post-tax incomes" and "increased by 7.5%".
Bias by Omission
The article focuses on seven European countries experiencing a decline in real post-tax income but doesn't discuss the situations in the remaining 20. This omission limits the scope of understanding and might create a skewed perception of the overall economic situation in Europe. While acknowledging space constraints, the lack of comparative data for other countries weakens the analysis.
False Dichotomy
The article presents a false dichotomy by primarily focusing on the negative impacts of tax increases in certain countries without sufficiently exploring the positive impacts of tax reductions or wage increases in other countries. While acknowledging some countries with higher increases in post-tax income, the overall narrative disproportionately emphasizes the negative.
Sustainable Development Goals
The report highlights a decrease in real post-tax income for average single workers in seven European countries. This negatively impacts their standard of living and exacerbates income inequality. Increased taxation, particularly social security contributions, is identified as a key factor, disproportionately affecting lower-income individuals and widening the gap between the rich and poor. The situation is further complicated by bracket creep, where inflation pushes individuals into higher tax brackets without a real increase in income. This lack of indexation to inflation worsens inequality.