In this case tax rate cuts are high and individuals will have to work more and

In this case tax rate cuts are high and individuals

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In this case, tax rate cuts are high and individuals will have to work more and to invest as well. The federal tax system comprises of two parts that is in two ways structural provisions that implements income tax on individuals and corporate net income and a system of tax expenditures where the government financial assistance programs are done indirectly through special tax provisions other than through government expenditures. However, some countries eliminate or reduce contributions from lowest paid workers and their benefits are financed through their employers. To create equity and efficiency in the system contribution rates should be proportional to the sources of finances Social Security System and Benefit Allocation Social security benefits formula is said to provide substantial redistribution favoring low income earners, workers facing abnormal risks of being totally disabled, married couples with a single earner .These individuals enjoy generous treatment since high wage workers, unmarried and childless workers and dual income married couples receive less benefits. The largest allocations go to payment of retirement benefits. The benefits are a form of social insurance to ensure that low income earners do not retire poor. They are collected through taxing monitored by Federal Insurance Contribution Act (FICA) or the Self Employed Contribution Act (SECA) throughput a workers career. The amount of benefits received depend on earnings except for the elderly and the disabled who are not in a position to work. Benefits under old age programs
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MANAGEMENT 4 cover long term risks such as disability and pensions are payable for life .Also dependents of a pensioner or insured are liable to payments in case of death resulting from work injuries. All people in the tax payroll are eligible to retire at 62 with reduced benefits but higher benefits at full retirement age which range between 65-67.The benefits depend on wages earned for at least 35 years. If one has worked for less than 35 years then the non-contributory years are assigned zero earnings during calculations. Privatizing Social Security Fund and Its Effects on the System Social security programs account for 24% of the total U.S spending as at 2015.The expenditure exceeds the revenues collected and it is projected to run out of money by 2034.Before, the allocations didn’t allow individual contributions to be placed in private investment accounts but some people feel that workers should have the freedom to control their retirement investments. Private accounts will yield higher returns than the current system and will help restore solvency of the systems. Opponents of privatization fear loses by retirees in
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