Home-Country Data and Tax Profiles
To maintain an expatriate’s home-country purchasing power while on assignment, determining how employees spend money at home is an important component in calculating an accurate goods and services index.
A Home-Country Data and Tax Profile provides data on how consumers spend income in the home country. ORC develops profiles for every home country in the ORC international compensation matrix. The profiles show, for varying salary levels and family sizes, how local nationals dispose of income across four major categories: goods and services; housing (shelter and utilities); income taxes (including social security); and the remainder, often called reserve or savings, but also including some miscellaneous expenditures.
The data are presented in three tables:
- The Goods and Services Spendable Income table indicates the typical amounts spent on goods and services according to salary level and family size (i.e., home-country spendable income). The following categories are included in spendable income: food at home, food away from home, clothing, furnishings and household operation, medical care, personal care, tobacco and alcohol, recreation, transportation, and domestic service.
- The Housing Norms table provides housing norms, or the average combined expenditures for shelter and utilities by salary level, distinguishing between households of single persons and those of families of two or more persons. The shelter component consists of expenses for a primary dwelling, taking into account expenditures for both renters and owners: rent (plus utilities if included in rent) and any repairs charged to renters, mortgage interest, property taxes, insurance, maintenance, and repairs. The repayment of mortgage principal is a form of savings and, as such, is excluded. Utilities consist of expenditures for fuel and light, as well as power for heating, air-conditioning, cooking, and operating home appliances.
- The Hypothetical Taxes and Social Security Contributions table consists of hypothetical income taxes calculated according to salary level and family size. Social security contributions are available by salary level only, as the contribution does not normally vary with the number of persons in the family.