Now You See It...
Payroll tax is likely the tax you most want to have cut, but will it ever happen?
By Chris Penttila •
Opinions expressed by Entrepreneur contributors are their own.
Congress is debating $350 billion in new tax cuts. But ifyou're holding your breath for a cut in payroll taxes, youmight as well exhale. The payroll tax has been called the"ignored tax," because it never gets cut. Payroll taxesmake up 34.9 percent of federal revenues and are expected toincrease to 36.3 percent of federal revenues by 2004, according tothe Tax Policy Center, a nonprofit, nonpartisan group that studiestax policy. Payroll taxes currently constitute 15.3 percent ofpayroll in employee and employer contributions combined.
Entrepreneurs indicate in surveys that the payroll tax is theirgreatest obstacle to business and job expansion, says Robert J.Walker, president of Get America Working!, a bipartisan employmentpolicy group in Arlington, Virginia. "Cutting the payroll taxby 10 percent would increase employment 3 percent in the shortterm," he says. "That's a lot of jobs."
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