RSSSocial Security Tax Rates 1937 – 2008
After a series of rate increase spanning 40 years — from 1950 to 1990 — the Social Security tax rate has been held constant at 6.2% of the earnings base discussed in the first chart of this section. For employees, the amount of taxes paid is matched by employers. Self employed individuals pay a rate of 12.4% on their earnings base.
Increasing the earnings base each year (as opposed to increasing the tax rate) is considered to be a more progressive method of raising additional tax revenue to fund the Social Security program. However, as will be seen in the next few charts, even the annual increases in the earnings base hasn’t been sufficient to prevent oncoming problems with the program. An increase in the Social Security tax rate is likely to be a component of any serious attempt at fixing the coming crisis in Social Security.
One Response to “Social Security Tax Rates 1937 – 2008”
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December 8th, 2008 at 10:24 pm
It would seem to be more powerful, to show the true tax rate of 12.4. Whether you are employed or self employed for every dollar up make up to the limit is taxed at 12.4% for social security or other programs funded by loans from social security.
It is still an income tax whether the individual pays it or the business.
Primary point is that it is another tax to fund government programs.
Would love to see some graphs on total real tax rates not just income as most show them or split up.
Thanks
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