This article is over 10 years old


Payroll Tax Hike Will Hit Lower-Wage Earners Hardest

The wealthy won't be the only ones paying higher taxes under the New Year's Day fiscal deal.



To embed this piece of audio in your site, please use this code:

<iframe src="" style="height: 115px; width: 100%;"></iframe>

The McConnell-Biden Plan allows the 2010 payroll tax cut to expire. The tax rate reverts to 6.2% on the first $114,000 workers earn this year. That’s up from 4.2% in each of the last two years.

“Although everyone is — it’s the same 2%, additional 2% for everyone, I think it’s going to impact lower-wage earners the most.”

Barbara Hale is a tax principal with UHY Advisors.

“For someone who’s earning $30,000 a year, they’re going to be paying an additional $600, and to the extent that’s spread over 12 months, they’re going to see a difference of $50 less in their take home pay as a result of the expiration of this payroll tax holiday.”

In addition to wage earners, the payroll tax hike also applies to independent contractors and other self-employed individuals.

Today in Houston Newsletter Signup
We're in the process of transitioning services for our Today in Houston newsletter. If you'd like to sign up now, fill out the form below and we will add you as soon as we finish the transition. **Please note** If you are already signed up for the newsletter, you do not need to sign up again. Your subscription will be migrated over.
Andrew Schneider

Andrew Schneider

Politics and Government Reporter

Andrew Schneider is the senior reporter for politics and government at Houston Public Media, NPR's affiliate station in Houston, Texas. In this capacity, he heads the station's coverage of national, state, and local elections. He also reports on major policy issues before the Texas Legislature and county and city governments...

More Information