By Hook Law Center
Any reform proposal with a fighting chance would likely include an increase in payroll taxes.
Would the American public support such measures?
Recently, the National Academy of Social Insurance (NASI) surveyed 2,000 Americans to determine what reforms they would support in order to shore up Social Security. NASI found that 82 percent of respondents would support increasing taxes on working Americans, while 87 percent would support taxing the wealthy. Eighty-two percent of those respondents with incomes over $100,000 per year supported the idea of raising their own taxes.
Although Democrats and Independents were disproportionately likely to support tax hikes, nearly three quarters of Republicans supported increasing taxes.
The survey also asked respondents to choose from a range of hypothetical packages of adjustments to benefits and tax revenue. Not only did respondents show a willingness to raise taxes enough to close the projected financing gap, but, 71 percent preferred a package that would simultaneously increase benefits.
These measures would:
- phase out the cap on earnings subject to payroll taxes so that all workers pay into Social Security throughout the year;
- gradually raise the rate at which workers and employers are taxed from 6.2 percent to 7.2 percent;
- raise the minimum Social Security benefit so that workers who paid into the system for 30 years could exceed the poverty line solely through Social Security income; and
- increase cost-of-living adjustments (COLA) to better reflect real-world price inflation.
In contrast, the options that hurt a package’s appeal among respondents included such cost-control measures as raising the retirement age to 70 years old and enacting means-testing for benefit eligibility.
The elder law attorneys at Hook Law Center assist Virginia families with will preparation, trust & estate administration, guardianships and conservatorships, long-term care planning, special needs planning, veterans benefits, and more.