Massachusetts

Employer Costs, Take-Home Pay, and Tax Wedge for an
Average Manufacturing Wage Worker in MASSACHUSETTS


	Annual
	Amount	Rank


Total Cost to Employer*	$31,303	12

Take-Home Pay	$22,109	42
Take-Home Pay, % of Employer Costs	70.6%	40

Tax Wedge*	$9,194	7
Tax Wedge, % of Employer Costs	29.4%	5

Gross Earnings	$27,200

Taxes Withheld from Worker's Paycheck
Social Security/Medicare Payroll Tax	$2,081
Federal Income Tax	$2,048
State Income Tax	$963	10
	-----------
Total Taxes Withheld	$5,091

Hidden Taxes Paid by Employer on Worker's Behalf
Social Security/Medicare Payroll Tax	$2,081
Workers' Compensation Contribution	$1,567	14
State Unemployment Insurance Tax	$400	9
Federal Unemployment Insurance Tax	$56
	-----------
Total Employer-Paid Taxes	$4,103

Employer-Paid (hidden) Share of the Tax Wedge	44.6%	21


Source: Dean Stansel, "The Hidden Burden of Taxation: How the Government Reduces
Take-Home Pay," Cato Institute Policy Analysis No. 302, April 15, 1998.
*Total cost to employer does not include the cost of fringe benefits (such as employer contributions to private health insurance plans and pensions) and tax and regulatory compliance. The tax wedge does not include the host of other taxes--property taxes, sales taxes, gas taxes, cigarette taxes, etc.--that workers must pay with their remaining take-home pay.