Imagine that congress decided to fund an increase in Social Security benefits by increasing the payroll tax on employers. Would this prevent employees from being affected by the higher tax? Why or why not?

 

Social security benefits are the benefits that the employees receive in events such as loss of job due to several reasons, old age etc. These are derived from the payroll taxes which is paid by both employees as well as employers.

Step-by-step explanation

If Government decides to fund an increment in social security benefits by increasing the payroll taxes on employers only, there will be increment in contribution of employees in the payroll taxes as well as social security policy which reflects that employees and employers should contribute equally to social security related taxes. Employers communicate the increment in payroll taxes to employees on the basis of order of government. It specifies that there will be decrement in earnings of salary of the employees. As the income is higher, the increment in cut is higher on the basis of percentage increase in payroll taxes.