In US, the income of the upper middle class is quite high. Assuming that the net annual income, after adjustment for tax relief, of a US citizen is US$100,000 in 2011, the income tax (from wikipedia) is 28% (for single person). The amount of tax he has to pay is US$28,000 or US$2333/month.
In 2011 Singapore, if a person earns a net annual income of SGD$100,000, the income tax that he has to pay consists of 2 tiers; first SGD$80,000 is 5.375% or SGD$4,300, next SGD$20,000 is 14% or SGD$2,800. A total of SGD$7,100. This gives an effective rate of 7.1% and monthly tax of SGD$592. Source: Singapore IRAS webpage.
While the exchange rate of SGD and US$ is different, I am looking from a perspective of a upper middle class resident in Singapore and US$ which should earn about a quantum of $100,000 in annual income, irrespective of foreign exchange.
In California USA, the sales tax is 7.25% which can total up to 9.25% including local sales tax. In Singapore, the consumption tax (GST) is 7%. Comparable if you stay in both cities.
Assuming a upper middle class American drives a BMW 640i coupe in 2012, he will have to pay US$73,600 (MSRP from BMW USA). He will need to work 0.74 year to pay for that car. For the same car in Singapore in 2012, the upper middle class Singaporean would have to pay SGD$355,800 (price from SG Carmart including the infamous certificate of entitlement). In Singapore, he will have to work 3.6 years to pay for the same car.
Comparing the income tax and the car price (and associated taxes) over 10 years, the American would have paid USD$353,600 (US$280,000 + USD$73,600). The Singaporean counterpart would have paid SGD$426,800 (SGD$71,000 + SGD$355,800) over the same period.
Additional Info, the US annual median wage in 2010 is US$26,364. The Singapore annual median wage in 2010 is SGD$2710 x 12 = SGD$32,520. Source: social security on line and salary.sg.
From the Big Mac Index 2011, the big mac in US costs US$4.07. In 2011 Singapore, the big mac costs SGD$4.41.
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