 payroll taxes are taxes imposed on employers or employees, and are usually calculated as a percentage of the salaries that employers pay their staff. payroll taxes generally fall into two categories: deductions from an employeeâs wages, and taxes paid by the employer based on the employee's wages. the first kind are taxes that employers are required to withhold from employees' wages, also known as withholding tax, pay-as-you-earn tax (paye), or pay-as-you-go tax (payg) and often covering advance payment of income tax, social security contributions, and various insurances (e.g., unemployment and disability). the second kind is a tax that is paid from the employer's own funds and that is directly related to employing a worker. these can consist of fixed charges or be proportionally linked to an employee's pay. the charges paid by the employer usually cover the employer's funding of the social security system, and other insurance programs. the economic burden of the payroll tax falls on the worker, regardless of whether the tax is remitted by the employer or the employee, as the employersâ share of payroll taxes is passed on to employees in the form of lower wages than would otherwise be paid."cboâs analysis of effective tax rates assumes that households bear the burden of the taxes that they pay directly, such as individual income taxes and employeesâ share of payroll taxes. cbo assumesâas do most economistsâthat employersâ share of payroll taxes is passed on to employees in the form of lower wages than would otherwise be paid. therefore, the amount of those taxes is included in employeesâ income, and the taxes are counted as part of employeesâ tax burden." http://www.cbo.gov/sites/default/files/effectivetaxrates2006.pdf page 3http://www.americanbenefitscouncil.org/documents/bush_taxbenefits_1pager.pdf ==national payroll tax systems== ===australia===  the australian federal government (ato) requires withholding tax on employment income (payroll taxes of the first type), under a system known as pay-as-you-go (payg). the individual states impose payroll taxes of the second type. ===bermuda===  in bermuda, payroll tax accounts for over a third of the annual national budget, making it the primary source of government revenue.bermuda government budget statement 2009 the tax is paid by employers based on the total remuneration (salary and benefits) pai
Employment Taxation Withholding_taxes