That makes no flippin' sense. They don't pay income tax but adding a 9% income tax makes them worse off. Huh?
Allow a deduction for everyone for an amount equivalent to the poverty level.
Lots of reitired people don’t pay payroll tax because they aren’t working, they are living off Soicial Security, investments, maybe withdrawling from IRAs and 401Ks. A lot don’t have enough income to owe much in taxes after deductions. Under Cain’s plan they pay 18%, including 9% on money they already paid income tax on.
You are right. Anybody who is working legally is paying Social Security and Medicare taxes, as is their employer. Whoever wrote the article is either clue-free, or is admitting that nobody in the poorest 30 million households works, or rather works legally.
And even the self employed poor should be paying FICA and Medicare at like 15%, although some probably don't.
I think it is wise to have a yearly income limit below which no taxes are due. Otherwise you end up with kids having to file a tax return because they made $200 shoveling snow for the neighbors.