Eliminate Payroll Taxes?
My friend Peggy posted a link to this article from NPRs Marketplace on Facebook yesterday.
Former Secretary of Labor Robert Reich has an interesting proposal that could be politically viable.
Eliminate payroll taxes for the first $20,000.
This would immediately stimulate spending by adding to the paychecks of just about every working American. Right now, 80 percent of Americans pay more in payroll taxes than they do in income taxes. And lower-income workers, who would receive the largest proportion of the benefits, are more likely to spend the extra cash than are people with high incomes.
The cut would be paid for by applying the tax to those making over $250,000. Currently, income over $106,000 is exempt from payroll taxes.
Sounds like this would get the economy rolling again pretty quickly.
Reich has written that Obama’s approach of cutting corporate taxes isn’t likely to give the necessary boost the economy, and I think he’s right.
I guess we’ll see in a few years how this plays out. I’m not optimistic.
- ROBERT REICH | Why Obama Is Proposing Whopping Corporate Tax Cuts, and Why He’s Wrong (kitsapsun.com)
- “White House Preparing for a Payroll Tax Credit?” and related posts (washingtonindependent.com)
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