Economist: Payroll Tax Cut Would Help the Economy, Trump's Tariffs Do Not
INDIANAPOLIS--A payroll tax cut would help the economy, but President Trump's tariffs are hurting the economy. That's the sentiment from Matt Will, an economist at the University of Indianapolis.
"A tariff is a tax. So when the President imposes tariffs on China and he says he's hurting China, that's true. But he's also taxing the American citizen," Will said in an interview with 93 WIBC's Tony Katz Wednesday morning. "I believe if it were not for the tariffs, we wouldn't be having a discussion about a recession. It is increasing taxes. So all the great things he did with the tax cut two years ago, some of it's being reversed because of the tariffs, which are a tax increase," Will said.
Will said Trump may succeed in the end, but the tariffs are causing a lot of short-term pain. A payroll tax cut, like the one former President Barack Obama, signed off on in 2011, would provide the relief the economy needs, says Will.
"It puts more money back in your pocket. About $120 billion a year would flow back into the economy if this payroll tax cut was put in place," Will said.
The growth of the economy is slowing down, so Will says it's time to give the economy a little boost.
"Bipartisan people should be on board with a payroll tax cut. Democrats all agreed to do it with Obama in 2011-2012, but they won't do it with President Trump. This is politics at its worst," Will said.
Katz asked Will what the chances are there could be a "Nancy Pelosi-led House of Representatives having a vote on the reduction of the payroll tax?"
"Can I guess less than zero?" Will answered.
(PHOTO: Thinkstock/Valeriya Potopova)