Is Trump's Payroll Tax Idea Viable?

Many people have heard that President Donald Trump is suggesting and highly encouraging payroll tax cuts for workers. His thinking is that today’s workers deserve a break similar to what was provided to employers via the CARES Act. Under this act, employers were able to get a break from payroll taxes throughout the remainder of 2020. But, would a similar move for workers be smart? It depends on who you ask.    

The Pros  

Many individuals are all for Trump’s suggestion. They like the idea of bringing home larger paychecks, especially in a time when many people are seeing their hours cut or are dealing with the fallout of a household member who has become unemployed.  

The Cons

However, many financial experts have spoken out against the proposal. They point to the fact that, while it may help those who are currently employed, it won’t help those who have lost their jobs due to the Coronavirus pandemic. In this way, some experts argue, the plan would only serve to help those who need help the least.  

Some have also mentioned how Social Security trust funds are likely to become exhausted more quickly in light of COVID-19 and its consequences. Thus, if a payroll tax cut were to work, it would have to include a way to replenish those funds. Furthermore, some individuals even feel like the plan would unfairly impact senior citizens, who have been most affected by this crisis and who often rely on Social Security in order to survive.  

Like most things the president does, this suggestion has been met with mixed feelings and emotions. And, while only time will tell whether or not this plan will come to fruition, it is not looking likely anytime soon since the House legislators have reportedly reacted with less than enthusiasm.