Consumer confidence socked by payroll tax hike
By Patrice Hill
The Washington Times
Tuesday, January 29, 2013
U.S. consumer confidence took a dive this month, wiping out all the gains of 2012, a drop fueled by the expiration of the 2 percentage point cut in payroll taxes, the Conference Board reported Tuesday.
The tax increase took effect on Jan. 1, and though long expected in Washington, it appeared to take consumers by surprise. It was included in the $650 billion “fiscal cliff” tax package passed by Congress in the early morning hours on New Year’s Day. The bill was dubbed by the media as a “tax hike on the rich,” but the payroll tax provision hit the paychecks of primarily middle- and low-income consumers.
“The increase in the payroll tax has undoubtedly dampened consumers’ spirits and it may take a while for confidence to rebound and consumers to recover from their initial paycheck shock,” said Lynn Franco, economist at the Conference Board.
The index fell to 58.6 from 66.7 in December. Confidence also slumped in December as Congress and the White House battled over the tax package, spoiling what started out to be a strong Christmas spending season.
In the end, as the din from Washington over the budget and taxes crescendoed in the weeks surrounding Christmas and New Year’s Day, consumers withdrew from the malls and the shopping season had a weak finish.
Read more: https://www.washingtontimes.com/news/2013/jan/29/consumer-confidence-socked-payroll-tax-hike/#ixzz2JP2lZNlW
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I thought only the rich were going to see a tax increase.
I thought only the rich were going to pay more taxes.
I thought only the rich were going to pay more taxes.
Stop crying and move on. PS i’am not rich.
When the social security tax reverts back to 6.2% after a 2 year “payroll tax holiday” that is NOT a tax increase.
Stop your crying.
You will have plenty to cry about later on, because you can’t borrow 46 cents of every dollar you spend and NOT have taxes increase some time in the future. Also, if you think only the “Rich” will see tax increases then congratulations….because you will soon be one of those “Rich” taxpayers.