Rick1 wrote:Adrian42 wrote:Rick1 wrote:Also read this week an interesting article to put all the taxes 10 percent down and at the same time salaries (costs). They have my vote.
Why don't you move to Estonia?
Low taxes and low salaries should clearly make you happy there...
And I hope you are aware that this would mostly hit lower to middle income people, who would get lower salaries but who would have to continue to pay the same Finnish prices.
Well-qualified people would just move out of the country - Sweden would be happy to get even more Finnish nurses.
You are aware of the amount of jobs Finland is losing because of their expensive production/services?These are not all replaced by Angry birds developers. Even Government (Traffi) has outsourced to Spain. It is better to have more people (e.g. youngsters) for lower wages
i don't think attempting to get cheaper than Estonia is the right strategy for Finland.
The strongest economy in the EU at the moment is my home country Germany, and the areas where Germany is strong are areas where salaries in Germany are higher than in Finland.
Or let's put express it differently:
Finland cannot beat China in being cheap.
But Finnish exports to China are strong, Finland should aim at strengthen that, and the main factor for Finnish success in exporting to China are not low wages.
Rick1 wrote:(Especially costs for employers e.g. too much mammi, pappi, pekka days) these means more clarification according to western europe standards, everybody 2 1/2 days a month holiday and simplify, no doctor educ<ation needed to apply all these stupid saturday holidays,first year no holiday etcetc.
The Finnish holiday system is a bit odd, but it doesn't really create additional costs.
(Whether your suggestion to give everyone a sixth paid holiday week (like most people in Germany get) and compensate for that by shortening paternal/maternal leaves would increase or decrease costs depends on how much you'd shorten the latter.)
Rick1 wrote:So higher amount of people paying taxes instead of lesser people paying more taxes.
If the Finnish government would allow Finnish employers to pay only the Estonian minimum wage of € 320 per month, then 3 people employed full-time would earn less than one person earns today.
Rick1 wrote:Less VAT gets people spending more.
Wrong.
Even in the best case people are spending at most the same (but getting more for the same money).
And even in this best case the tax income would obviously be lower - which tax hikes elsewhere do you suggest to compensate for the loss in VAT income?
And I am already overweight - if you'd lower the prices in Finnish supermarkets I would (hopefully) not buy more food, but buy the same amount of food and have more money left at the end of the month to put into my savings account.
You also make the wrong assumption that all companies would reduce the prices accordingly - in areas with low competition (e.g. Finnish supermarkets) the prices would likely stay the same and the companies would simply enjoy a higher profit.
Rick1 wrote:If you would raise the VAT in Germany to 24, the whole economy will get in a recession for several years.
Increasing the VAT in Germany to Finnish levels would increase prices in Germany by around 4% - and any discussion involving substantial VAT increases in Germany is also about how to use that for lowering the tax and social security costs associated with wages (to tax consumption instead of labour).
So that's basically the same as 2 years without wage increases at an inflation rate of 2% - and following your logic what Finland is doing at the moment will bring the Finnish economy into a recession for several years...
And wages in Germany have been increased by around 3% for most people this year with a similar increase scheduled for next year, so claiming a price increase around 4% would cause a
recession for several years doesn't sound realistic at all.
