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You missed (or I didn't explain well) the part where I said that the tax percentages get lower as you go up the brackets.

So instead you'd have to use an example where (for example) the tax rate is 20% until 80 and 10% above 80.

Situation 1

Guy 1: salary = 100, tax = 16 + 2 = 18

Guy 2: salary = 50, tax = 10

Total tax = 28

Situation 2

Guy 1: salary = 90, tax = 16 + 1 = 17

Guy 2: salary = 60, tax = 12

Total tax = 29

That's how it works in Denmark and Sweden, and I suspect other countries too. I had never thought about the problem we're discussing, but in retrospect it's a nice property of this system.

PS: Yes, it's quite ridiculous to have a system in which you actually make more money by having a smaller salary. That doesn't happen with the tax system here.

 



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