That's just not true. It might be taxed at the state or local level, but a lot of people simply don't pay federal income tax (and in fact receive a relatively large refund at the end of the year).

(many people get confused and interpret social security and health insurance withholdings as taxes).

Many people refer to payroll taxes as payroll taxes, yes.

Especially since they are, literally, taxes.

I would probably even go so far as to call insurance a tax as well since I am legally required to pay it. I may have my choice what company administers my policy but they're effectively private arms of the government.

There's no federal tax penalty anymore as part of trumps tax cut. Some states are enacting state tax penalties now though