Welcome to the world of real taxes!
I agree that the FICA cap makes the tax regressive, but remember that Social Security benefits are also capped by the income amount you give. If you uncap the income to be taxed, you also uncap the income input into the formula for receiving benefits, which means that Bill Gates pulls down $10 million/year in social security at age 67 (People who pay more in get more out under the formula).
A better strategy is to just get rid of payroll taxes entirely, and dispense with the myth of the social security "contribution" (there's nothing in the lock box but a big fat for from the 1980s and '00s anyway). Instead, increase all the brackets in such a fashion as to offset the lost revenue from FICA, and thereby subsidize the working poor by making the taxes they now pay for FICA part of their exempt income (which they cannot do at present).
Oh, I got the idea from Bob Graham.
Posted by Keith G at March 22, 2004 06:31 PMBrilliant!
Posted by Jim D at March 22, 2004 10:36 PMFunny to hear liberals complain about liberal taxes as a result of liberal entitlements. And I mean funny wierd not funny ha-ha.
Posted by Adam at March 23, 2004 02:37 PMFunny to hear liberals complain about liberal taxes as a result of liberal entitlements. And I mean funny wierd not funny ha-ha.
Posted by Adam at March 23, 2004 02:38 PM