🚀 go-pugleaf

[edited]
>>It is not that way for anybody whose income taxes are withheld
>>by the employer.  That the government is taking _anything_
>>from you at all via payroll-deducted taxes is a complete
>>myth.  You can't believe everything that's printed on your
>>pay-stub.  All of your payroll-deducted taxes are paid directly
>>from your employer to the government.  There is no real sense
>>in which ANY of that money was EVER, at ANY time, "yours", so
>>you can hardly speak of its being taken from you.
>
>This is untrue.  From a booking, accounting, profit and loss point of
>view, every employee has to return to the employer at least as much as
>it costs to keep them on the payroll.  It does not matter to the
>employer if that money is spent on taxes on on a check to the
>employee.  The aggregate total cost of employment must be covered by
>the return on the employee's labor, or they will lose their job.
>Thus, the money is paid out of the employee's labor.

An even more subtle example of this shows up in the Social Security 
withholding. Supposedly, only half of the tax is paid by the employee and the 
other half by the employer. But as is pointed out above, an employee's wages 
must be covered by their work. From the viewpoint of the employer, tax that 
they pay direct for Social Security is just as much a cost of the employee as 
are wages. So most of the cost of the tax is paid by the employee and not by 
the employer. Having it come from the employer just makes people feel better.

A more interesting problem shows up in corporate taxes. Who actually pays the 
tax? Does labor get lower wages, or consumers pay higher prices, or owners get 
lower dividends, or some combination? This is still a research topic in 
economics.

John Dreystadt