A key senator Friday advocated cuts in the Social Security payroll tax that would save 130 million workers and employers a total of $62 billion during the next two years.
The proposal by Sen. Daniel Patrick Moynihan (Y.) would cancel a 0.14% increase in the levy scheduled to take effect on Jan. 1 and would lower the rate by an additional 0.96% for workers and employers in 1991.
"We can no longer tolerate the use of Social Security surpluses to finance, say, B-2 bombers or a capital gains tax cut," he added.
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Moynihan contends that it is unfair tax policy to rely so heavily on a payroll tax that allows no deductions and takes the same percentage from everyone regardless of their ability to pay.
"The United States almost certainly now has the most regressive tax structure of any Western nation," he said. "This is so because the Social Security payroll tax--which is decidely regressive--has come to make up an increasingly larger share of total federal tax levies."
About three-fourths of all wage-earners, he said, will pay more in Social Security taxes in 1990 than they will pay in federal income taxes, which are more geared to the ability to pay.
http://articles.latimes.com/1989-12-30/news/mn-974_1_social-security