President Trump
Donald John TrumpDHS expands staff authority to collect information on people who threaten monuments: Republican report points to Trump’s payroll tax cut on Republican coronavirus bill, for now Trump threatens to duplicate Portland in other major cities PLUS it is renewing its pressure to make a payroll tax cut part of the next coronavirus relief package, adding a wrinkle to the upcoming negotiations.
Trump over the past week has emphasized that payroll tax relief is one of his top legislative priorities. But lawmakers on both sides of the aisle aren’t enthusiastic about the idea, while many economists argue that it may not be an effective way to provide aid to American households during the coronavirus pandemic.
During statements in the Oval Office on Monday, Trump said a payroll tax cut is “very important.” He also called it a mutually beneficial situation for workers and employers.
“It is a great savings for people,” he said. “It’s a tremendous savings, and I think it’s an incentive for companies to hire their workers and keep their workers.”
Trump added that the tax cut is one of many elements that Congress and the administration are discussing as they begin to analyze what is expected to be the latest COVID-19 relief bill before Election Day.
In an interview with Fox News that aired on Sunday, Trump said Chris Wallace
Christopher (Chris) WallaceWhite House, GOP Senate Shock Over Proof Of Defense Overnight Defense: House Approves Defense Policy Amendments To Insurrection Act, Nuclear Tests | Defense spending bill for House vote next week | Afghan peace is elusive after Taliban deal passes key deadline Trump tweets photo of himself wearing mask MORE You may not sign an aid package in the law if it doesn’t include your desired tax cut.
“I will have to see, but yes, I would consider not signing it if we don’t have a payroll tax cut,” Trump said.
Discussions on the upcoming coronavirus relief bill are expected to escalate this week, as lawmakers return to Washington after a two-week recess on July 4.
treasury secretary Steven Mnuchin
Steven Terner MnuchinGOP points to Trump’s payroll tax cut on Republican coronavirus bill: For now, the White House and Senate clash with the Republican Party over trial funds The Republican Party watches over a billion for schools in the coronavirus package MORE and chief of staff of the White House Mark Meadows
Mark Randall Meadows Republican Party signals cut of Trump’s payroll tax in Republican coronavirus bill; for now, the White House, the Senate Republican standoff over trial funds The Republican Party plans more than a billion for schools in the coronavirus package MORE They plan to meet with Senate Republicans on Tuesday to discuss their plan.
Leader of the Senate majority Mitch McConnell
Addison (Mitch) Mitchell McConnellGOP points to Trump’s payroll tax cut on Republican coronavirus bill: for now, the White House, Senate Republican standoff over testing funds The Senate confirms that Vought will be the OMB director of Trump MORE (R-Ky.) He said Monday afternoon that Republican senators “will present a strong starting point for additional recovery legislation hopefully as early as this week.”
Lawmakers and administration are under pressure to act quickly. The improved unemployment benefits are expected to expire at the end of the month, and the legislation will be almost exponentially more difficult as the November elections approach.
Trump has been pushing for payroll tax to be cut across the pandemic, but has fallen short on every previous aid package.
A $ 2.2 billion coronavirus relief law that Trump enacted on March 27 included payroll tax relief for employers, but not for employees. That law allows employers to defer payment of their share of Social Security payroll tax, and creates a refundable payroll tax credit for certain wages that companies pay their employees.
Employees and employers pay Social Security payroll taxes of 6.2 percent of wages and pay Medicare payroll taxes of 1.45 percent.
With lawmakers and the administration turning their attention to an additional coronavirus relief measure, Trump is emphasizing a reduction in payroll taxes, even for employees.
But the idea still faces criticism from some of the top Republican lawmakers, including the chairman of the Senate Finance Committee. Chuck grassley
Charles (Chuck) Ernest Grassley The Republican Party signals the reduction of Trump’s payroll tax in the Republican Coronavirus Bill; for now, Trump’s push for payroll tax cut prompts rejection by Republican Party Graham publishes recently declassified documents on Russia’s investigation MORE (Iowa), who said Monday that a cut in the payroll tax would create “a public relations problem” because it would be perceived as damage to the Social Security trust fund.
Senator John Cornyn
Conservative John CornynTea party Allen West will guide the Texas Republican Party through the 2020 election Trump’s push for payroll tax cuts prompts Republican rejection Planned Parenthood launches six-figure ad campaign that criticizes vulnerable senators of the Republican Party in the bill COVID-19 MÁS (R-Texas), a McConnell adviser, warned that a payroll tax cut would be “problematic.”
“I think it’s problematic, because obviously the trust funds for Social Security and Medicare are already on the road to insolvency,” Cornyn said. “I am not a fanatic.”
Furthermore, any coronavirus package will need bipartisan support to become law, and Democrats continue to oppose the idea of reducing payroll taxes. They point out that such a move would not provide relief to the millions of Americans who are unemployed.
“A cut in payroll taxes does not help those who are not on the payroll,” said the senator. Kamala Harris
Kamala Devi HarrisDemocrats call on McConnell to implement the Voting Rights Act in honor of Lewis Nation mourns the death of John Lewis: “One of the greatest heroes in American history” Hillicon Valley: Russian hackers Back in the Spotlight with Vaccine Research Attack | Twitter says 130 accounts targeted in this week’s cyber attack | Four fired, dozens suspended in CBP investigation on racist and sexist Facebook groups MORE (D-Calif.) Tweeted on Monday.
Trump’s momentum is backed by some Republican lawmakers, as well as conservatives known as Stephen Moore
Stephen Moore, optimistic about Stephen Moore’s economy: “This was a good week,” shows Sunday: Coronavirus resurgence dominates Trump economist, says voting for Biden is “terrifying proposition” MORE, who advised the president’s campaign in 2016. They argue that it would help encourage people to return to work.
In an encouraging sign for Trump, House minority leader Kevin McCarthy
Kevin Owen McCarthyGOP notes that Trump’s payroll tax cut on the Republican Coronavirus bill, for now, Trump’s push for payroll tax cut prompts Republican rejection at 12:30 , filed by Facebook, Supreme Court denies request to speed up Trump’s financial record case MORE (R-Calif.) He told reporters Monday that a payroll tax cut would be part of the Republicans’ proposal.
Moore said he believes Republicans are “really rallied around this idea.”
However, several economic policy experts from across the ideological spectrum argue that a cut in payroll taxes would not be the best way to help people in need.
“There are much more effective things that can and should be done,” said Kris Cox, a senior fiscal policy analyst at the Left Center for Budget and Policy Priorities. She said the best options include improved unemployment insurance, expanding the Supplemental Nutrition Assistance Program and providing tax relief to states.
Douglas Holtz-Eakin, president of the right-leaning American Action Forum, said a payroll tax exemption until the end of the year wouldn’t do much to increase hiring because hiring is a longer-term decision.
Kyle Pomerleau, a resident member of the American Enterprise Institute, who leans to the right, said a payroll tax cut “would undermine the Social Security trust fund and the Medicare trust fund.” He noted that the federal government can transfer money from the general fund to trust funds, but said that measure is bad fiscal policy because it “breaks the link between tax and profit.”
Since passing his 2017 tax cut law, Trump has been interested in passing additional tax cuts. The 2017 law did not win the majority of voters, and the president is now stepping up his economic attacks on the alleged Democratic presidential candidate. Joe Biden
Joe BidenBiden Vows To Fight Foreign Interference Efforts If Elected On The Money: Congress Will Face Coronavirus Relief Legislation | Unemployment Claims Raise Bets in Aid Battle COVID-19 | S&P 500 erases 2020 losses Biden pledges to repeal Trump travel ban initially in most Muslim countries MORE.
When asked about Trump’s plans for more tax cuts in a press call last week organized by the President’s campaign, Vice President Pence mentioned the President’s interest in a payroll tax cut.
“A payroll tax cut would put money in the pockets of working Americans,” Pence said.
Whether a payroll tax cut is included in the next package may depend on a number of factors, including how other controversial issues are resolved.
Marc Gerson, a former Congressional tax adviser who now directs the practice of government affairs at Miller & Chevalier, said the amount said the amount of tax relief in the bill may depend on the overall size of the package and how the measure It addresses other issues such as unemployment insurance, aid to state and local governments, and liability protection for businesses.
“A cut in payroll taxes, even if it’s only on the employee side, could be extremely costly,” he said.
Juliegrace Brufke and Jordain Carney contributed.
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