I’m in the UK but I’m sure the logic around much of the world is the same. It seems like an incredibly bureaucratic waste of money to tax public sector wages, rather than just pay the workers upfront what they would get post-tax. I might be missing something though, so hope someone on here might enlighten me if I am!
In: Economics
I work for a local government entity in the US. My employer cannot know what sort of tax breaks and credits I’m entitled to, so they can’t know exactly how much I would make post-tax. Besides, they can’t just hold onto the tax part of the paycheck for themselves, as I also owe taxes to the state and federal governments.
My employer does tax withholding, which estimates how much I will owe in taxes, and sets that money aside and sends it to the state and federal governments directly, but that’s what *all* employers do, so there’s no difference between public and private sector jobs in this respect.
Latest Answers