Do you mean you'll only make 19.2k net from 80k gross? That sounds like an awful amount of taxes. I'm from Austria and here it's ~27% for social security and income tax is ranging from 0% to 55%. From 80k gross you would make around 42k net (Calculated without any tax benefits).
VAT is typically charged to customers and then compensated with the VAT you pay if you as a freelancer have expenses.
For instance in Spain I have to increase my clients invoices by 21%, but if those invoices are for software, you have almost no purchases to offset that, so I need to pay that 21% quarterly.
So to earn 50k€ in net terms, I would need to charge 25k€ extra just on income tax, plus 3.5k€ on direct taxes on freelancing (because Spain), plus 21% VAT.
Is vat not a tax? I think every government cost that is a percentage of income or spending should be calculated as your expense for the government. I think inflation also should be kept in mind as it is a hidden tax. Maybe harder to calculate.
VAT is a tax on consumption. But it is only levied when you take a certain action with your funds -- i.e. consume it. You could also (re)invest and let your capital compound.
So yes, if you spend all your money to the last penny, that would be your tax rate. But many (higher income) people do not.
But all your income is meant to be spent. All people invest so they get to buy more in the future, not for the sake of it. If you don’t pay VAT today, you will in the future.
