Burden of the federal insurance contributions act

Reference no: EM1374474

The federal Insurance Contributions Act (FICA) tax is a payroll tax that finances Social Security and MEdicare. By law, employees each contribute 7.65 percent of the workers wages toward the events. Note that the tax rate is 15.3 percent of wages and the tax payments are equally divided between employers and employees.

Would an economists say that the burden of the FICA tax is shared equally? Why or why not?
Who bears more of the tax burden? Workers or employers? Use supply and demand curves to illustrate your answer.

Reference no: EM1374474

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