Questions About Wage and Tax Cut Act of 2003
July 7, 2008 - 8:29 PM
(Editor's Note: The following Q. and A. was prepared by employees in the offices of Sen. Mary Landrieu (D-La.) and Sen. Jon Corzine (D-N.J.) regarding their proposed Wage and Tax Cut Act of 2003)
Question : How many people will receive a rebate?
Answer : Every working American will receive a rebate payment based on their payroll taxes paid in 2001, the last year for which all payroll tax records are complete. According to the Social Security Administration, more than 150 million people made payroll tax payments to Social Security. On top of that, more than 5 million employers would be eligible for relief.
Question : When will they get the payments?
Answer : Every working American will receive two rebate checks: the first will be sent out within 2 months of passage of the legislation, the second will be sent out by December 1,2003. The Department of Treasury has flexibility under the bill to alter this schedule if needed.
Question : How will this proposal stimulate the economy?
Answer : The Wage Tax Cut Act of 2003 will put up to $765 in the pocket of every working American.
Question : How much will the plan cost?
Answer : While we do not have a final score from either the Joint Tax Committee or the Congressional Budget Office. we estimate that the plan will cost approximately $200 billion.
Question : What about people at the lowest end of the income spectrum, who didn't earn $10,000 but desperately need the help?
Answer : They will receive a refund of any payroll tax they have paid. For low income individuals payroll taxes comprise the largest part of their tax burden. This bill will provide these people a great deal of relief.
Question : Will workers pay taxes on this money? Answer : No.
Question : How much of an impact can a one timerebate really have on a struggling economy?
Answer : This will encourage people to make purchases that they have been putting off. They might need a new washing machine, or a lawnmower. They may be putting off repairs to their home. This money will help. The tax break for employers will make hiring a new worker more affordable and help them avoid the need to layoff current employees.