ASA Government Affairs Committee Monitors Plans for Economic Stimulus Package
The core of an economic stimulus package will be tax incentives for businesses and individuals. The idea is to get money into the hands of people most likely to spend it, thereby infusing needed cash into the economy. The challenge is whether the Congress and the White House will be able to reach consensus on tax provisions that are equitable and meaningful. The obstacles are many. Congressional Democrats must first decide if they will insist on keeping their “pay-go” pledge, which requires them to offset any spending and tax cuts with offsetting “savings” from other federal programs.
Some Democrats have said they are willing to spend as much as $100 billion in the coming months for tax rebates, housing assistance, unemployment benefit extensions and aid to cash-strapped states. President Bush wants a $150 billion package with $100 billion targeted at individuals and $50 billion for businesses. The White House plan would allow businesses to write off 50 percent of the purchase of equipment immediately.