Slashdot Mirror


Norway, the Country Where No Salaries Are Secret (bbc.com)

In Norway, there are no such secrets. Anyone can find out how much anyone else is paid -- and it rarely causes problems. From a report: In the past, your salary was published in a book. A list of everyone's income, assets and the tax they had paid, could be found on a shelf in the public library. These days, the information is online, just a few keystrokes away. The change happened in 2001, and it had an instant impact. "It became pure entertainment for many," says Tom Staavi, a former economics editor at the national daily, VG. "At one stage you would automatically be told what your Facebook friends had earned, simply by logging on to Facebook. It was getting ridiculous." Transparency is important, Staavi says, partly because Norwegians pay high levels of income tax -- an average of 40.2 percent compared to 33.3 percent in the UK, according to Eurostat, while the EU average is just 30.1 percent. "When you pay that much you have to know that everyone else is doing it, and you have to know that the money goes to something reasonable," he says. "We [need to] have trust and confidence in both the tax system and in the social security system."

38 of 218 comments (clear)

  1. 2001? by Calydor · · Score: 2

    News? When the article is about something that happened 16 years ago?

    --
    -=This sig has nothing to do with my comment. Move along now=-
    1. Re: 2001? by Z00L00K · · Score: 2

      And it's the same in Sweden since many years.

      --
      If builders built buildings the way programmers wrote programs, then the first woodpecker would destroy civilization.
    2. Re:2001? by eastlight_jim · · Score: 5, Informative

      The reason it's in the current news (at least on the BBC) is that the BBC have recently published the salaries of many of their top earners for the first time. The discussion has arisen because many are earning in the millions and are effectively paid from the public purse (well, licence fee but all the same in the end...).

      Original article

    3. Re:2001? by thegarbz · · Score: 4, Interesting

      It's still news to Americans that the world doesn't implode simply because someone knows how much you get paid, or why you went to see the doctor last week.

    4. Re: 2001? by KozmoStevnNaut · · Score: 2, Informative

      Because secret negotiations result in a lot of highly-skilled individuals being paid less than they're actually worth, because they mistakenly think their below-average pay is average. It's exploitation by the employers.

      --
      Eat the rich.
  2. Re:I wonder if... by wierd_w · · Score: 5, Insightful

    I don't see it making it hard to justify a large salary, what I see it being a complication for, is large yearly bonuses for management, while the rank and file get shafted.

    Generalized higher pay grades, even really obscene ones, would not really be an obstacle as long as they 1) pay their proper % of tax, and 2) have that income as a steady, constant thing.

    It is when the managers make up fairy stories about how "We gotta do triple shifts or the company will go under! OMG!", pay everyone beneath them peanuts, and then give themselves huge, fat bonuses at the end of the year for "Doing such a great job!!" that people will notice it, and then raise cain.

    I personally would LOVE to see this level of wage transparency in the US-- It would make a great many HR, and management teams break out in cold, bloody sweats.

  3. Same in Finland. by Anonymous Coward · · Score: 3, Informative

    Same thing in Finland, everyones total income is public, of course you don't nesseccary know how much you peers salaries are as, they might have additional income from through other work etc. However income from stock and other investments are show separately as they have different tax structure.

  4. Nice to have for corporation tax too by hughbar · · Score: 5, Insightful

    Certainly, given the avoidance in the UK by Google etc., it would be nice to know exactly what all the corporates are [not]paying compared to their turnover in the territory. I say turnover, because there's less possibility of manipulation and it will give some guide to profitability.

    Profit is easy to manipulate, in order to make tax liabilities disappear, yet the offending company still uses the infrastructure in the country. This is a point made by Warren Buffett, that well-known communist, not specifically by me.

    That way, we know which companies to boycott. And yes, since you're asking, I have no FB account, don't buy anything from Google ads and am beginning to minimise my use of Amazon. https://www.hive.co.uk/ support local bookshops in the UK, for example.

    --
    On y va, qui mal y pense!
  5. Re:And that's a good thing? by Gussington · · Score: 4, Insightful

    How is making your contribution to the public purse public anything soviet like? By keeping this information the shadows you allow the thieves at the big end of town to continue to allow steal from the rest of us. .

  6. Re:Nothing special by Anonymous Coward · · Score: 2, Informative

    > Put in some effort and get rewarded.

    Turns out, that's not how it works. Anywhere. Commonly held fallacy though.

  7. Re:Nothing special by Anonymous Coward · · Score: 2, Insightful

    There is no such fact.

  8. is 40% high by TheCarp · · Score: 4, Interesting

    I mean I know we Americans like to pretend to have low taxes, but, in reality, we just have a lot of misdirection and backdoor taxes.

    Every fee you pay for a government service, especially the ones they impose on you like driver's licenses which need to be renewed for some reason and the same with car registrations. Then they setup their regulations to maximize offences so they can disproportionately rake in money from the poor. Those fines are all taxes really.

    40%? That isn't far off from some estimates I have seen for totals of what a lot of Americans give our worthless government.

    --
    "I opened my eyes, and everything went dark again"
    1. Re:is 40% high by Anonymous Coward · · Score: 2, Informative

      Just as a datapoint: I earn about $54k in Norway, and I paid an effective 36% in direct taxes, plus the sales taxes (25%, 12% on food).

    2. Re: is 40% high by Entrope · · Score: 2

      40% income tax is high, and on top of that is VAT. You get taxed 40% on what you earn, and 18% or 25% on most of what you spend.

    3. Re:is 40% high by markdavis · · Score: 2

      >"40%? That isn't far off from some estimates I have seen for totals of what a lot of Americans give our worthless government."

      Do you REALLY think income tax is all the taxes they pay? You completely skipped VAT, employer's SS tax, corporate tax (which gets passed onto the price of everything), excise tax, property tax, Inheritance and gift tax.

    4. Re:is 40% high by jedidiah · · Score: 4, Interesting

      Actually being a small business is very advantageous. While "rates" may be high, you can deduct pretty much anything. This is in stark contrast to an individual wage earner that has to bear nearly 100% of work related costs.

      Corporate tax rates even for small businesses are only relevant to profits after all expenses including wages.

      Even lush bennies for low paid employees can be seen as a tax dodge for the business owner.

      --
      A Pirate and a Puritan look the same on a balance sheet.
    5. Re: is 40% high by mikael · · Score: 3, Informative

      Entry level graduate earns around 250K NOK (Norwegian Kronor). Senior Engineer earns around 550K NOK.

      Mobile smartphones are between 5000 and 6000 NOK. Mobile network connection seemed to come in two bills of about 1500NOK each. Electricity bills were split up into network/distribution and production but didn't cost more than 600NOK/quarter. Internet access costs would be subsidized by the employer. Weekly shopping is around 800NOK for one person (Meny, Rema1000) but use-by-dates were only a couple of days, as everything is imported from the rest of Europe.

      There's a vehicle import duty of 25K NOK, so everyone usually ends up buying the high-end range of cars and vans - with large touchscreen at the center of the vehicle. Homes started at 250K NOK. Student places rent for 700NOK, luxury apartments 1500NOK.

      You have all the catalog brand names: H&M's, Dressmann. Narvesen is the equivalent of WH Smiths and convenience stores. They stock newspapers, confectionary, magazines as well as hot food like hot dogs wrapped in bacon.

      --
      Vintage computer adverts: http://www.vintageadbrowser.com/computers-and-software-ads
    6. Re: is 40% high by ortholattice · · Score: 2, Insightful

      Bullshit.

      Between city, state and federal taxes I pay about 47 cents per dollar earned. That isn't good or advantageous. It's fucking crushing. I could hire 12 more people with even a 10% tax reduction.

      Let's see: 10% of 47 cents is 4.7 cents per dollar reduction. If we assume each employee costs $50K with benefits (probably low balling it), 12 employees would be $600K, which is 4.7% of your net income before taxes. That means your income before taxes is about $13 million and after taxes $6.8 million. So why can't you hire the 12 more now, especially if each employee produces more than they are paid, making you even richer? Are you having trouble making ends meet on $6.8 million a year?

    7. Re:is 40% high by Gavagai80 · · Score: 2

      You can't deduct things from your profit. You deduct expenses from revenue to get the profit you're taxed on. Taxing a company's revenue makes zero sense unless you want to randomly bankrupt all low-margin businesses.

      --
      This space intentionally left blank
    8. Re:is 40% high by CanadianRealist · · Score: 3, Insightful

      Don't forget to figure in your health care costs. That's a service which most (first world) governments provide, using money paid by taxes.

    9. Re:is 40% high by Solandri · · Score: 2
      You haven't actually run a small business, have you? Deductions can't increase profit because to get a deduction you have to spend the money on something. So to avoid paying $3 in taxes, you have to spend $10 on something. Meaning you've got a net loss of $7 ($10 spent, $3 saved on taxes). You do gain whatever you bought with the $10, but if your business didn't need it, that's an inefficient use of funds.

      Or to put it another way, why pay $10 for benefits for low-paid employees to get a $3 tax deduction, when you can just pay the employees $10 more (making them no longer low-paid and thus presumably much happier) and get the exact same $3 tax deduction because wages are also a deductible expense? (The actual answer is payroll taxes - Social Security and Medicare are subtracted from wages, but not from benefits. Nothing to do with deductions.)

      Actually being a small business is very advantageous. While "rates" may be high, you can deduct pretty much anything. This is in stark contrast to an individual wage earner that has to bear nearly 100% of work related costs.

      • When you're an employee and earn a wage, you pay income tax on what you make.
      • When you own a company, you get paid two ways:
        • You earn a wage, which the company deducts as an expense and you pay income tax on, just like the employee wage owner.
        • And you pay corporate tax on the company's profit, plus income tax when you pay yourself with that profit. (In general; the reality is a lot more complicated.)

      That last bullet point means unless you can figure out a way to pay zero corporate tax, the small business owner's overall tax rate is always higher than a wage earner's. This double taxation of small business owners compared to a wage earner discouraged wage earners from making the leap and starting their own business. Why start a business and incur all the headaches that come along with it just so you could be taxed more than when you're an employee? So to remove this impediment to the average Joe starting a small business, the government made LLCs (limited liability corporations). LLCs are pass-through entities for tax purposes - the LLC isn't taxed. Instead, any money the company makes is automatically considered your income. So you only end up paying income tax on it, not both corporate and income tax. (Partnerships are another option, but involve a lot more bookkeeping which generally isn't worth it unless you're actually partners with someone in the business and want the protections it provides.)

      And if a wage-earner is paying for work-related expenses (isn't being reimbursed by their employer), those expenses are deductible on their personal income taxes.

    10. Re:is 40% high by LynnwoodRooster · · Score: 2

      Yeah, we're not the highest, for the G20 we're 3rd place behind Argentina and Indonesia when it comes to average effective corporate tax rate.

      --
      Browsing at +1 - no ACs, I ignore their posts. So refreshing!
  9. same goes for US government jobs by mapkinase · · Score: 2

    if you are a federal worker, your salary is not a secret.

    Except that in contrast to Norway it is harder to find

    --
    I do not believe in karma. "Funny"=-6. Do good and forbid evil. Yours, Oft-Offtopic Flamebaiting Troll.
  10. Re:I wonder if... by tlhIngan · · Score: 2

    I dunno. I could just as easily see an HR department using that against you.

    "Well, we'd really love to give you a raise, but we'd have problems if everyone saw how much more you're making..."

    Any Norwegians here? Would love to hear how this actually affects your relationship with your employer and fellow employees.

    That's the general fear about making salaries transparent - that high earners will have to justify their high salaries and thus see that it might be lowered. What really happens is those who make less start asking questions as to why they make less. Sometimes it's genuine skill and contributions - Employee A makes more because their work is high quality and people like working with Employee A - using his work output, working with them in general, etc. Employee B, however, barely produces output, and people hate using it because there are so many errors than it needs to be corrected before it can be used, as well as people just avoid interacting with Employee B.

    Other times, there can be real problems. This is in general the bigger cauxe - perhaps they didn't negotiate their starting salary as much, or other reason. This is why companies hate salary transparency - they don't want high performers to know how little they're being paid compared to their peers whom were recently hired. One coworker made a mention that if he applied for a job the company was offering, he'd make more money. (He went to his managers and the company re-evaluated all their pay scales).

    https://www.youtube.com/watch?...

  11. Re:$50k by thereitis · · Score: 2

    A mechanical engineer, eh. Not exactly rocket science.

  12. Re:I wonder if... by Joce640k · · Score: 4, Insightful

    Everybody here is missing the other point: This global transparency ensures that people know their tax money "goes to something reasonable"

    It totally keeps the rich, the government, etc., in check.

    --
    No sig today...
  13. Re:I wonder if... by AmiMoJo · · Score: 4, Insightful

    Wage transparency is great for so many reasons. As well as preventing the kind of abuse you describe, it also makes it easy to get a fair salary without heavy negotiation, and be sure you aren't getting screwed over.

    As a result it also tends to drive down various pay gaps (gender, ethnicity etc). Some people claim that such gaps don't really exist, but the fact that they are reduced in countries with wage transparency disproves that.

    --
    const int one = 65536; (Silvermoon, Texture.cs)
    SJW, n: "Someone I don't like, and by the way I'm a fuckwit" - AC
  14. Re:I wonder if... by haruchai · · Score: 5, Insightful

    - the only 'explaining' they 'have to do' is so that others can also try and do the same. AFAIC income and wealth taxes are robbery, armed robbery regardless if it is 100%, 50% or 0.00000000000000000000000000000000000000000001%

    Somalia was tax-free for almost a 1/4 century; you should have emigrated.
    If nothing else you'd have a much greater appreciation of both the value of taxation & what "armed robbery" is really like.

    --
    Pain is merely failure leaving the body
  15. Re: I wonder if... by Gavagai80 · · Score: 2

    If wage transparency is bad for everybody, why does Norway have the world's 5th highest salaries?

    --
    This space intentionally left blank
  16. Re:I wonder if... by Anonymous Coward · · Score: 2, Interesting

    The US has a much different culture when it comes to social justice. Old countries, like Norway and Japan, have more of a sense of community than the US, where no-one gives fuck about anybody but themselves. In business negotiations a deal can be struck where the opposing party may suffer irreparable damage, where in civilized countries though is given to the other party's survival.
    The US was founded on conquest, genocide, slavery, and war. The Land of the Free's constitution was written by slave owners who had stolen and killed the original land owners.
    Taxation in Norway and and other EU countries are mostly funding social projects, not so in the US where the 100% of personal income tax revenue is funding the military. Wars are invented to keep the military industrial complex rolling in perpetuity.
    Most democratic countries have political parties with differing opinions, not so in the US where there is only one more party than in China.
    The school system in the US is designed to make people into stupid unquestioning consumers, and soldiers, that will vote idiots like Trump and Bush into an office, for which there is no requirements for any relevant qualifications or talent. Trump has never been elected to even a minor political office. He is a dirty simpleton unschooled trust-fund-baby businessman whose grandfather founded their fortune by renting hotels to prostitutes, and has many bankruptcies and scandals behind him. He makes George Bush look like a smart guy.

  17. Re:I wonder if... by Gavagai80 · · Score: 2

    But in Norway, doesn't the tax system give everyone about the same net income, no matter how much they may gross?

    Nope. Some other European countries have high tax brackets for big earners, but Norway's top tax bracket is only 39%, which is lower than the USA: https://taxfoundation.org/how-...

    --
    This space intentionally left blank
  18. It's already been stated by nehumanuscrede · · Score: 5, Interesting

    But it would go a long way in calling bullshit on an employer who tells you no on a payraise because " budgets are tight " all the while paying each of their execs a yearly bonus that exceeds your lifetime income.

    This sort of transparency would cause a great deal of discomfort for those companies who regularly lie to their employees.

    In fact, those companies would find it difficult to keep any employees and, in the end, might have difficulty being a company at all when all of their talent leaves because of it.

    The Income Inequality gap in the US is so wide now, this level of transparency would likely cause a great deal of anger at best.

    An insane amount of violence at worst.

  19. I'm Norwegian but I've also lived in the US by Terje+Mathisen · · Score: 5, Informative

    As the article stated, it used to be that everything was completely open and searchable on the internet for a few years, before that point you had to visit city hall (or the post office) and manually search through huge books.

    The current setup is actually very nice, in that the transparency goes both ways:

    In order to be allowed to access any tax records you first have to use the same two-factor authentication you would use to deliver your own tax return, and if you then look at any tax return except your own, the person you looked up will be notified that you did so.

    I.e. if I think my neighbors are spending too much money and want to check what they have declared, they will immediately be told that I did so.

    Terje

    --
    "almost all programming can be viewed as an exercise in caching"
    1. Re:I'm Norwegian but I've also lived in the US by Terje+Mathisen · · Score: 2

      That's actually a good idea, or it would have been if Norwegians hadn't been both trusting and trustworthy.

      I.e. there have been several international comparisons where Norway end up with very high productivity, supposedly because the fact that we can (at least mostly) trust people.

      My favorite story is the time when I lost my wallet on the bus and someone who did the cleaning for the bus company found it and phoned me three weeks later (it had gotten stuck between the seat cushions.)

      --
      "almost all programming can be viewed as an exercise in caching"
  20. Re:I wonder if... by Lord+Crc · · Score: 2

    But in Norway, doesn't the tax system give everyone about the same net income, no matter how much they may gross?

    No. The base tax is 36%, but there's a decent base deduction on the gross income to find the taxable income. Then, if you make more than a certain amount (taxable, higher than the average income) you pay an extra ~10% on the amount above that limit.

  21. Sounds like a free market to me by rbrander · · Score: 5, Insightful

    ...and any time pricing information is concealed, it's NOT a free market.

    You know the only people who WANT a free market, really want one? Small actors who have no leverage. The BEST deal you can get when you're small is a fair one, as produced by a free market. Every large actor (the company vs you, at salary time, say) wants a closed market, so they can use their size advantage. The Company knows EVERY salary in the company (and they always want to know what you were paid at every previous job, when you apply) while you only know your own, at negotiation time. That's a huge advantage for them, which they always wish to preserve.

  22. Re:I wonder if... by ShanghaiBill · · Score: 4, Insightful

    "Well, we'd really love to give you a raise, but we'd have problems if everyone saw how much more you're making..."

    That is a Good Thing. If two people are doing equal work, one should not get a raise just for being more assertive.

  23. Re:um, by KozmoStevnNaut · · Score: 2

    As the US slides further left

    Uhhhh, what?

    --
    Eat the rich.