Instead of sending more direct relief to Americans hit by the economic impacts of the coronavirus pandemic, President Trump has suggested he would prefer temporarily easing the tax burden on individuals and businesses.
11 states have already begun lifting restrictions on businesses and public gatherings, with 7 more to follow by the end of the week. ABC News' Kimberly Brooks has new details.
But since payroll taxes are deducted from employees' earnings, those who aren't taking home a paycheck -- including the 3.8 million who filed for unemployment benefits for the first time last week -- wouldn't see any uptick in income. Many experts said that in addition to putting nothing back into the pockets of those who suddenly have no cash flow, the suspension wouldn't do much to spur hiring.
"If you look at the 2009, 2 percentage points payroll tax cut under the Obama administration, the evidence bears out that most of that federal tax cut was saved by consumers," Watson said. "With rent due on May 1, we need to provide $2,000 a month to everyone until this crisis is over. If we can bail out corporations, we can make sure everyone has enough to pay for basic necessities," Sanders said in the tweet.Some are also wary that since payroll taxes support Social Security and Medicare, even a temporary payroll tax cut could devastate the social safety nets.
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