Various state and local taxing authorities in the US require an employer or the employee to withhold and remit a tax on the

wages A wage is payment made by an employer to an employee for work done in a specific period of time. Some examples of wage payments include compensatory payments such as ''minimum wage'', ''prevailing wage'', and ''yearly bonuses,'' and remuner ...

paid to an employee. Some states require both the employer and employee to remit a portion of the total occupational privilege tax (OPT), while others only require one or the other to do so. As such, it is a type of

payroll tax Payroll taxes are taxes imposed on employers or employees, and are usually calculated as a percentage of the salaries that employers pay their employees. By law, some payroll taxes are the responsibility of the employee and others fall on the em ...

. The genesis of this tax is the state's claim in recovering accrued benefits provided to the taxpayer in enabling them to become employed and allowing for the state or

municipality A municipality is usually a single administrative division having corporate status and powers of self-government or jurisdiction as granted by national and regional laws to which it is subordinate. The term ''municipality'' may also mean the go ...

to further provide for taxpayers in the future.

Notes

Taxation in the United States Payroll {{tax-stub