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Laitner and Silverman say tax rate changes could lengthen working lives, lower Federal deficit
August 29, 2012
Using data from the ISR Health and Retirement Study and from the Consumer Expenditure Survey, John Laitner and Dan Silverman examine how social security payroll tax cuts targeted at workers over 55 would affect their chances of working longer — and thus keep them paying more income taxes and helping to reduce the Federal deficit. Their analysis suggests that these changes would increase work life by 1.5 years and garner about $15,000 more per person in Federal income tax. Laitner says these targeted tax-rate changes “would reward older workers for staying on the job and also benefit the economy as a whole.”