Because payroll taxes are a flat ~15% of your wages (up to ~$106K). And it's BEFORE deductions. It's not supposed to be a tax, per se, but it acts like a really regressive one.
OK, I get it now. That point wasn't clear at all in the article. How can you not consider that a tax?
Because you're buying insurance (workers' compensation) and an annuity (social security) with the money withheld... It's the New Deal. It was a very different time then, when nobody wanted to take unemployment benefits or anything else considered charity. So they made it a rule that everyone pays in and everyone collects.
Which is what a tax is. A requirement that the society pays in as a whole to provide benefits to the society as a whole. It seems extremely arbitrary to single this out as "payment for a service." When you pay taxes that go to support roads or schools, it's the same concept. You may or may not believe it's a service you should be paying for, but that doesn't change the concept behind it.
Taxes go into the general fund. These withholdings go into trust funds. The withholdings are not on your net income, after deductions, they're on your gross earnings.
Not all taxes are processed the same, but they are still conceptually the same. All you're really saying is that these taxes are earmarked and can't be used for other things. I don't see any useful reason to not classify them as taxes. You're generally willing to play fast and loose with what is taxation...for example, you termed the health insurance mandate a tax. Which I agree with, but it's technically not a tax. If that is a tax (and it is, once you get down to brass tax, err, tacks), so is this. It's paid by society for society.
To make a long story short, rich Americans individually pay a smaller percentage of their income in taxes than ever before.
Workers compensation insurance is not funded by payroll tax (or any other tax) and employees never pay a dime for it. It's just like any other insurance and is funded by insurance premium paid by business owners (at least it's that way in Oregon, not sure about other states).
Charitable contributions are paid by society for society. They're not taxes either. Are union dues taxes? How about the money contributed to a pension plan? As for ObamaCare and taxes, the administration continues to argue in court that the mandate is a tax. Though they lied us into war by claiming all along it wasn't. http://www.forbes.com/2010/07/26/he...a-opinions-contributors-merrill-matthews.html The Biggest Tax Increase In U.S. History? The Obama administration just flip-flopped on a long-standing Barack Obama promise. What's new about that, you ask? In this case it amounts to what's likely the largest tax increase in U.S. history. President Obama has repeatedly asserted that the new health care law's individual mandate requiring everyone to have qualified health insurance coverage or pay a penalty is not a tax. In a testy exchange with ABC's George Stephanopoulos--who, ironically, also pushed for sweeping health care reform legislation when he worked for then-President Bill Clinton--Stephanopoulos pointed out that ObamaCare critics call the mandate a tax. Obama rejected the claim and noted that his critics call everything a tax: "For us to say that you've got to take a responsibility to get health insurance is absolutely not a tax increase." And yet the Justice Department now claims the mandate is a tax, but not because the legislation refers to the mandate as a tax--it doesn't. Rather, the lawyers at Justice want the Supreme Court to confer its blessings on ObamaCare when the issue comes before the Court, and the lawyers are increasingly concerned that the 20-plus state challenge claiming the mandate is unconstitutional may hold up. So the Democratic defense has morphed from the "Of course we have the constitutional power to impose an individual mandate" defense to "The Commerce Clause gives us the power to mandate coverage" defense and now to their "It's a tax" defense. The Constitution clearly gives Congress the power to levy taxes.
How about paying a toll to cross a bridge? That's mandated by the government. How about tuition to go to a government school? How about a speeding ticket? It's not as clear as you're trying to make it out to be.
None of those are examples of the government mandating that society pay in for the good of society. The first two examples are examples of pay-per-usage (you can choose not to travel over the bridge or attend the public university and then you won't pay anything) and the third is a punishment. Similarly, buying stamps is not a tax. I think it's pretty cut-and-dry. When the government requires that you pay money that is then distributed back to the society in the form of goods/services, it's a tax. When it offers something you can choose to buy/pay for, it isn't a tax.
I think it's cut and dry that when the govt. charges a flat (rate) fee and puts the money in a fund and manages the fund like any insurance fund, it's not a tax situation. You describe a tax in general terms, which is a good definition. Govt. charges taxes and uses them for the benefit of society. The definition here is the govt. takes a fee and manages the money as any insurance company or pension plan does with a similar collection of money. It's not used for the benefit of society, but for the payment of benefits specific to the program.
All this tricky tax talk is taxing my train of thought. Let's tactfully change tactics and take a different tack by attacking tax evaders for their taciturnity.
Benefits specific to the program that society deemed beneficial for society. Every tax can be rephrased as a "fee," and you really haven't shown how payroll taxes are conceptually different from any other tax. All you've said is that they are earmarked to fund specific programs rather than thrown into a general purse, which isn't contradictory to the concept of a tax. Some taxes can be used generally, some can't.
Except you pay money in and you get money out, like an annuity. It's exactly not like what you describe, going into a general purse. Is the lottery a tax?
I expressly said taxes don't have to go into a general purse. Taxes can be earmarked for specific programs. That's nothing new or controversial. No, because you can choose to buy a lottery ticket. Since you seem to have already forgotten what I said, I'll repost it: I think it's pretty cut-and-dry. When the government requires that you pay money that is then distributed back to the society in the form of goods/services, it's a tax. When it offers something you can choose to buy/pay for, it isn't a tax.
