Asked by Paula marques on May 10, 2024

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The Social Security tax is regressive because it applies only on income below a "cap" income level.

Social Security Tax

A tax levied on both employers and employees to fund the Social Security program, which provides retirement, disability, and survivorship benefits.

Regressive

Relating to a taxation mechanism where the tax rate decreases as the taxable amount increases, disproportionately affecting lower-income earners.

  • Identify the backward progression characteristics of specific taxes and their reasons.
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Mylene BaronaMay 16, 2024
Final Answer :
True
Explanation :
The Social Security tax is considered regressive because it is only applied to income up to a certain threshold (the "cap"), meaning higher income earners effectively pay a smaller percentage of their total income in Social Security taxes compared to lower income earners.