I find it interesting to see people go on about income and corporate taxes. Having visited and lived in a few countries I can say that when it comes to taxes, people get what they pay for. If you pay little, you get little. If you pay a lot, you get a lot more.

Case 1: Guatemala
This is where I was born and lived during my childhood. Guatemala is considerd a "tax shelter" meaning that the taxation rate is so low that opening bank accounts and businesses in that country is an "advantage" against the higher taxation rates paid in North America and Europe. The average Guatemalan citizen pays about 6% income tax. Of course, the rich and powerful can exploit local corruption to avoid paying taxes at all. That is the case with most large foreign coprorations in the country. In exchange for the 6% income tax, people get next to no helath care and next to no education. As a result, about 70% of the population is illiterate (although the literacy rate has improved in recent years.) Publicly run hospitals are understaffed, underequipped and they don't have the money or medicines to take care of their patients. In Guatemala is you are rich you can pay for private schools and private universities. You can pay for private clinics and get top of the line health care. If you are poor you are desined to be illeterate and to die of some torpical disease that could have been prevented or cured with adequate medicines or vaccines.

Case 2: Austria
Not so differnt from Germany and other European countries. My ex and my son live there. Most Austrian citizens pay between 21% and 50% income tax. On the average, the rate runs about 41%. That means that 41 cents of every Euro people make is going into the government's hands. What do people get as a result? Free healthcare. I was there when my son had this minor nose operation. In most places he would have gone in and out of the hospital for a few hours. Instead they kept him 3 days. The hospital nurse came with a menu like in a restaurant. My ex had a bed assigned to her because they did not want my son to stay alone at night. The place was like a hotel more than a hospital, and this was the "shabby, old hospital" rather than the newer, more modern one. Education is free through gymnasium (roughly high school), and university is heavily subsidized, with people paying on the average 366 Euros per term (about US $500). Not only that, but if a student completes a degree on the alloted time, the fees are waived and university becomes free. Compare that with the thousands it costs to get an education in North America.

We can say that Austria and Guatemala sit in opposite sides of the coin. High and low taxes. A lot of services versus no services. People get what they pay for.

The interesting thing is perception. Many Austrians dislike the high taxes, and government and business are contantly at odds over taxation. Guatemalans hate having to pay even the 6%. Guatemalans also complain constantly about taxes. Very often it is not what people pay, but the perception they have of how the government spends taxes.

Guatemalans would be only too happy to get free education and free healthcare, but they would never accept reforming the taxation system and raising taxes steeply. Austrians would love to have their taxes reduced to 6%, but they would never accept losing the services they get.

Ultimately, who lives better? Austrians certainly do. So what is better? A more "socialist" or a more "capitalist" government? Up to a point, countries with low taxation rates seem generally worse off than those countries with higher taxation rates. Taxes have to be high enough to allow the government to operate and to invest in the economy, but not so high that the business sector get choked to death. It is a difficult balance to maintain.