Despite fears from tax professionals of a resurgence of the “tax rebate” fiasco that was 2002, the White House and Congress are reportedly considering an “emergency” rebate package for the current tax year.
President Bush has told congressional leaders that he favors immediate income tax rebates for taxpayers. Bush is reportedly asking for tax rebates of up to $800 for individuals and $1,600 for married couples. The rebates are likely to be limited to individuals with incomes of $85,000 or less and couples with incomes of $110,000 or less.
The idea was to put cash into the hands of the poor and middle class – those, the thinking goes, more likely to spend it quickly.
Bush is also pressing for tax breaks for businesses – no surprise there. What is surprising is that in the midst of a deficit, Bush does not believe that the breaks should be offset by spending changes elsewhere. Since the package he is suggesting would cost the country around $100 billion if reports are to be believed, many (myself included) are skeptical as to the long-term results of such a quick fix.
More details are scheduled for Friday.
