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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsPayroll Tax Cut Is Unlikely to Survive Into Next Year
http://www.nytimes.com/2012/10/01/business/economy/payroll-tax-cut-unlikely-to-survive-into-next-year.htmlWASHINGTON Regardless of who wins the presidential election in November or what compromises Congress strikes in the lame-duck session to keep the economy from automatic tax increases and spending cuts, 160 million American wage earners will probably see their tax bills jump after Jan. 1.
That is when the temporary payroll tax holiday ends. Its expiration means less income in families pocketbooks the tax increase would be about $95 billion in 2013 alone at a time when the economy is little better than it was when the White House reached a deal on the tax break last year.
Independent analysts say that the expiration of the tax cut could shave as much as a percentage point off economic output in 2013, and cost the economy as many as one million jobs. That is because the typical American family had $1,000 in additional income from the lower tax.
But there is still little desire to make an extension part of the negotiations that are under way to avert the huge tax increases and across-the-board spending cuts, known as the fiscal cliff, that will start in January without a deal. For example, without any action, the Bush-era tax cuts will expire and the military and other domestic spending programs will be reduced.
taught_me_patience
(5,477 posts)but it has to be done at some point.
JoePhilly
(27,787 posts)And that's true regardless of the outcome of the election.
Blue_In_AK
(46,436 posts)Drunken Irishman
(34,857 posts)The anemic economic growth would've been even worse without a payroll tax cut that boosted consumer confidence earlier in the year. Obama has been able to stay ahead of Mitt Romney mostly because the economic conditions have not dramatically worsened this year (and in some instances, improved). Had they stalled out last year or earlier this year, we're probably stuck in a recession and Obama is on his way to a Carteresque loss.
lonestarnot
(77,097 posts)Drunken Irishman
(34,857 posts)No matter who wins. It's going to be tough, but probably only temporary as we adjust to the new burden of tax increases.
dkf
(37,305 posts)Cliff occur.
That might be worth it.
Drunken Irishman
(34,857 posts)We'll bounce back and as you say, the initial damage will be worth it. The narrative will be ugly, but just as long as things bounce back before the 2014 midterms...
librechik
(30,735 posts)justgamma
(3,673 posts)I got a check for $600 from Bush plus $.50 a week. When President Obama passed his tax cuts I got $13 + a week.
When we say Bush tax cuts will expire is it only his and not Obama's? Talking only about Bush tax cuts make it seem to me that those are the only ones we got. How do we frame Obama's tax cuts?
dkf
(37,305 posts)justgamma
(3,673 posts)Just want to be clear.
dkf
(37,305 posts)Now he wants to extend only the ones under $250,000. But they are all scheduled for expiration.
julian09
(1,435 posts)and Senate leader Reed does away with filibuster rule, no problem. We have to do our part and give him those majorities.
Down ticket wins are essential to his and our success.
dkf
(37,305 posts)Doesn't matter who wins.
SickOfTheOnePct
(7,290 posts)If all of the tax cuts are allowed to expire, everyone that pays federal income tax will pay more. For example, a married couple filing jointly with $50,000 in taxable income (not AGI, taxable), would pay $6650 in federal income tax under current law, and $8299 if the tax cuts expire, or roughly $32/week more.
Not saying they shouldn't all expire, but it will affect everyone, not just the rich.