Cost of Living Index for California vs. Germany
One of the major factors that makes Germany a more expensive place to live when compared with California is the currency exchange rate between the Euro and the U.S. dollar. As of 2010, the one Euro is equal to $1.35 U.S. Another major factor is that income taxes in Germany are much higher than in California. For a fair comparison consideration must be given to the cost of housing, utility bills, food and gasoline in each country.
Other People Are Reading
-
Housing
-
As of 2010, the average cost per square foot in California can range from $110 to $120. According to the website "How to Germany," the average cost per square footage for a house in Munich is $190. The difference in square-footage cost between California and Germany is roughly $75, making an average-sized home of 1,350 square feet cost $155,250 in California and $256,500 in Germany.
Utility Bills
-
The price per kilowatt in Germany is on average 4 cents higher than California. Germany has a much colder climate than California. For this reason, the gas or electric bill will show significant differences in the winter months, making utilities a lot more expensive in Germany. As of 2009, the average kilowatt price in California was of 14 cents to the dollar. In the same year in Germany, the average cost per kilowatt was 16 cents to the dollar.
-
Food
-
Food prices are comparable between California and Germany Food prices in California and Germany are comparable and do not figure as major difference in the cost of living in each one. For example, a loaf of white bread in Los Angeles, California, is $2.29 and in Germany it is $2.50; a head of lettuce in Los Angeles is $1.79, where in Germany it is $1.56, as of 2010.
Gasoline
-
Gasoline prices in Germany are double than those in California. Distances in California are much greater than in Germany, and on average, a person will drive many more miles a year. The price per gallon for gasoline in Germany as of March 2010 is $7.03, making it more than twice as expensive as the cost of the price per gallon in California, which is $3.06, also as of March 2010. It is clear that even if the average German citizen drives 30 percent less than a California resident, the cost for fuel would still be higher in Germany.
Taxes
-
Germany can charge up to 10.75 percent more in sales tax than California. As of 2010, the two main taxes paid in Germany are income tax, ranging from 0 percent to 45 percent, and value added tax (VAT), which is 19 percent imposed on all services and goods. The VAT is sometimes reduced to 7 percent on certain foods, books and transport.
Every state in the U.S. pays a progressive federal income tax ranging from 10 percent to 35 percent. California pays an additional income tax that can go as high as 10.3 percent. Sales tax, which is the equivalent of VAT in Germany, is 8.25 percent as a base and can sometimes increase to 10.75 percent when local sales taxes are added to the initial sales tax.
In this case, the amount of tax paid by both Germany and California is dependent on income. A person in Germany making less than $10,000 will pay no taxes, where someone in California will pay 5 percent federal taxes, plus one percent state tax, totaling 6 percent. But a person making more than $400,000 in both California and Germany will end up paying roughly 45 percent.
The tax that is significantly different is the sales tax or VAT. Germany charges up to 10.75 percent more for goods and services than California.
-
References
- How to Germany: Buying a House or Apartment in Germany
- U.S. Energy Information Administration: Independent Statistics and Analysis
- Wallet Pop: Food Price Comparisons Around the World
- U.S. Energy Information Administration: Weekly Retail Premium Gasoline Prices (Including Taxes)
- California Gas Prices
Resources
- Photo Credit American currency image by magnumxl from Fotolia.com light bulb image by cherie from Fotolia.com bread image by Vladislav Gajic from Fotolia.com Refuelling by gasoline of the modern car image by terex from Fotolia.com tax forms image by Chad McDermott from Fotolia.com
More Like This
Comments
-
"making an average-sized home of 1,350 square feet cost $155,250 in California". no offense, but this figure is way off base. I've been to a lot of places in coastal California, as well as some areas inland, and I would say that the average home price in Cali is closer to $500 to $1000 per square foot. I've seen trailers selling for $350,000 before, and 1000-sq. ft. shacks selling for almost $1 million. the numbers may have declined recently due to contraction of the housing market, but the figures you're giving still seem ridiculously low to me. what cities were you looking in?
