Romig, Kathleen (2016, September 27)
Increasing Payroll Taxes Would Strengthen Social Security
Social Security is currently facing a significant – though manageable – long-term funding shortfall, which policymakers can address primarily by increasing Social Security’s tax revenues.
Not only is boosting Social Security’s payroll tax revenue justified by recent trends in inequality and the cost of health insurance, the majority of Americans oppose cuts to the program and support strengthening it by contributing more in taxes.
In a new CBPP paper, we present the three approaches to increasing payroll taxes, including: increasing or eliminating Social Security’s cap on taxable wages, expanding compensation subject to Social Security payroll taxes, and increasing Social Security payroll tax rates.
Social Security provides a foundation of income for workers and their families, and they pay for these benefits primarily through payroll tax contributions. Read the full report to learn more on how policymakers should address Social Security’s long-term funding shortfall.