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Taxpayers to receive additional rebates |
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Thursday, 14 February 2008 |
 | Fisher
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by BRITTANY PENLAND
Intern News Reporter
Hundreds of dollars will be given to taxpayers by the United States Federal Government beginning in early May, thanks to the economic stimulus package Congress passed last Thursday, according to The Washington Post.
President George W. Bush signed the economic stimulus package Wednesday.
Taxpayers will see checks in their mailboxes ranging from $300 to $1,200. According to CNN, about 116 million American households are expected to receive rebates.
Those individuals who earned more than $3,000 in income taxes will be given a minimum payment of
$300. Individuals who did not earn $3,000 will not benefit from the plan, according to The San
Francisco Chronicle.
Individuals will receive up to $600 in rebates, while couples who file jointly will receive $1,200, in
addition to $300 per child.
“It is a fairly standard practice for the government to use such fiscal policy programs during times when the economy is thought to be weakening,” Appalachian State University associate professor of
economics Dr. John W. Dawson said. “The idea is to provide an incentive for consumers to spend more to boost the economy. Ultimately, how much of an effect it has on the economy will depend on
how much of the money is actually spent by consumers.”
Along with the plan, regulations will be made to adjust payments for individuals who earn $75,000 a year and couples who earn $150,000. Wealthier tax payers will be given nothing from the federal government.
“I think that people will definitely spend the [tax rebate] because the majority of Americans don’t save money like they use to,” freshman journalism major Jeri-Lynn Gehr said.
Economics professor Dr. Larry T. McRae said the first economic stimulus plan was created by the Ford administration in the mid 1970s, issuing checks for about $100. This plan was also repeated
during the Carter administration.
“The history of past tax rebate plans designed to provide stimulus is not encouraging for the success of the current plan. The research on previous rebate plans shows that people, generally, don’t spend their tax rebate, but put it in savings or use it to pay off credit card debt,” economics professor Dr. Larry Ellis said.
President Bush told CNN the economic stimulus package will “boost our economy and encourage job
creation.”
“[The economic stimulus plan] certainly has the potential to create jobs if consumers spend the money
to buy goods and services produced by businesses, which would in turn need to hire workers,” Dawson
said.
While the plan may help to raise the current economic standings, the United States still remains in debt
to foreign countries.
“With the extra money that I can get with the tax rebate I can put it away in my savings or use it to pay
for college expenses,” freshman business marketing major Chelsey N. Fisher said.
“There is some controversy about it, but I think most economists will tell you that it is unlikely to have
any real effect,” McRae said. “If you stop and think a minute, where does the federal government get
$160 billion? They either take it from us in taxes, in that case it’s a wash, or they borrow it, in which
case we’re going to have to pay it back eventually, or it’s going to cause additional inflation.”
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