White House Denies Report of Payroll Tax Cut Amid Recession Fears
The Trump administration is denying a Washington Post report that said White House officials are discussing a payroll tax cut to help stave off a possible economic slowdown as recession worries continue to spread.
A White House official responded to the report with a statement saying a payroll tax cut isn’t being considered presently.
“As Larry Kudlow said yesterday, more tax cuts for the American people are certainly on the table, but cutting payroll taxes is not something under consideration at this time,” the official told CNBC.
The report comes amid growing worries about the future of the U.S. economy, which is enjoying a record-long period of growth since rebounding from the Great Recession. For his part, Trump has been lashing out at the press and Democrats while also haranguing the Federal Reserve to cut interest rates a full 1% and restart quantitative easing, both recession-era monetary policies, which sends mixed signals.
…..The Fed Rate, over a fairly short period of time, should be reduced by at least 100 basis points, with perhaps some quantitative easing as well. If that happened, our Economy would be even better, and the World Economy would be greatly and quickly enhanced-good for everyone!
— Donald J. Trump (@realDonaldTrump) August 19, 2019
The report comes amid growing concerns of a slowdown as the trade war with China drags on, and with more tariffs impending after Trump’s latest salvo.
However, the report confirms the Trump administration has not yet decided whether to push forward with a payroll tax cut — and with Democrats in control of the House, it seems more than unlikely they would pass a tax cut to help Trump’s economy.
Additionally, the 6.2% payroll tax helps fund Medicare and Social Security, two programs already in dire need of Congressional help to avoid impending budget shortfalls. Medicare will reportedly be insolvent by 2026, and Social Security will start running shortfalls by 2035.
Chuck Grassley, R-Iowa, is the Chairman of the Senate Finance Committee, and his spokesman said he hasn’t discussed a potential payroll tax cut and that recession talk is simply wishful thinking on the part of Democrats.
“At this point, recession seems more of a political wish by Democrats than an economic reality,” spokesman Michael Zona said.