Kudlow: Payroll tax deferral will give employed Americans ‘a gigantic wage increase’
White House economic adviser Larry KudlowLarry KudlowMORE said Sunday that the payroll tax deferment in President TrumpDonald John TrumpTrump suggests some states may ‘pay nothing’ as part of unemployment plan Trump denies White House asked about adding him to Mount Rushmore Trump, US face pivotal UN vote on Iran MORE‘s executive order will give millions of employed Americans “a gigantic wage increase.”
“There are roughly 140 million people who are working. There are roughly 15 million or 16 million unemployed. The unemployed is too high. There’s a lot of heartbreak there. That’s why we want to help them with the unemployment assistance,” Kudlow said on ABC’s “This Week.” “But the 140 million some odd, they’re going to get a gigantic wage increase, probably $1,200 between Sept. 1 and Dec. 31. And, again, we’d like to — we will do everything we can to forgive those loans. So I think that’s an incentive to work for those who are heroes during the pandemic, and also for the unemployed, it gives them an incentive to come back to work so we can offset some of the excesses of unemployment assistance.”
“I appreciate those things. Maybe we’re going to go to court on them. We’re going to go ahead with our actions anyways,” Kudlow tells @GStephanopoulos when pressed on criticism by GOP Sen. Sasse that Trump’s payroll tax deferral is “unconstitutional slop.” https://t.co/UsD0N9aYk0 pic.twitter.com/7PV2NVw2xy
— This Week (@ThisWeekABC) August 9, 2020
The payroll tax deferral, one of four executive orders relating to coronavirus relief signed by Trump on Saturday night after congressional negotiations fell apart, has been criticized for doing nothing to help the unemployed and harming the Social Security and Medicare funds. Democrats have also said companies would likely continue collecting payroll taxes to avoid a shocking bill for employees when the deferral period ends.
But Kudlow on Sunday pointed out that Trump would like to make the payroll tax deferral permanent.
“I do think the president, and it’s in the executive order, would like very much to make the deferral a permanent deferral. In other words, he will essentially let it go in future months rather than a payback. So it will be, you know, loan forgiveness in effect. That’s what this really is,” he said. “And I think businesses will come on.”