The structure of retirement programs can produce large
implicit taxes and subsidies for work at older ages as well as for alternative strategies to tap into retirement resources.
These tax rates include explicit taxes, such as federal and state income taxes and FICA payroll taxes, as well as
implicit taxes, such as the loss of government benefits or increase in income-based premiums for government programs that may result from higher earnings.
He concludes that, when one includes the impact of the ACA's
implicit taxes, the law's impact on economic output is "vastly more important than, say, the interest rate on federal funds."
For the serious argument against monetary finance lies not in the technicalities of future
implicit taxes, but in the danger that if we break the taboo and treat monetary finance as an acceptable option, politicians will be tempted to draw again and again from the well of monetary finance.
Income from all tax-preferred sources should be "grossed up" by
implicit taxes to measure H-S income properly.
(2) Also, a number of workers faced new
implicit taxes on their incomes, because the ACA is giving lower health care subsidies to people with higher incomes.
Slavov, "
Implicit Taxes on Work from Social Security and Medicare," Tax Policy and the Economy 25, no.
"Instead, the country captures dollars through the fixed exchange rate system and the
implicit taxes that are charged for transactions in CUC," Gonzalez-Corzo explained.
We are increasingly mired down with even larger government deficits, higher
implicit taxes through the loans we are racking up, the nationalization of health-care insurance, not to mention the auto industry, student loans, etc.
From an efficiency perspective, the marginal rate of taxation on labour for old workers should eventually approach zero, meaning that marginal
implicit taxes on pensions should be negative.
As a result of these very high
implicit taxes, the "net load" of the policy--i.e., a calculation that accounts for both the implicit tax from Medicaid and the standard pricing load imposed by the insurance company--are extremely high.
Any shift from paying
implicit taxes to a silent national partner to paying taxes directly to the state is bound to have many disruptive implications on the economic well-being of the country's nationals.