The Corner

More on Payroll Taxes

From a reader:

Social Security taxes are the “premiums” that pay for Social Security.  Please stop and think before you promote the notion of a Social Security holiday that you are cutting (even more than it already is) the link between Social Security benefits and payments.  We need this connection to be promoted more (so that participants can get a sense of what a bad deal it is) not less.  If you cut the link it is simply another tax-transfer scheme.   As long as there is a compulsory system, its appropriate that the relatively poorly-paid (the biggest beneficiaries) should pay more.

One of the biggest things I noticed when I started my own company is how big the government’s Social Security and Medicare tax take is – it’s the biggest check I sign on a monthly basis.  And the money disappears down a black hole in Washington, unlike my payments to the employees’ Pension and 401(k) plan.    More people should become employers and be aware of how big these amounts are.


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