As Americans wait for another COVID-19 package, President Donald Trump said he may attempt to suspend the payroll tax via an executive order.
“Well, I may do it myself,” Trump told “Fox & Friends” on Wednesday. “I have the right to suspend it, and I may do it myself—I have the absolute right to suspend the payroll.”
Payroll taxes are shared by the employer as well as the employee. Each party responsible for a 6.2 percent levy that goes toward Social Security and a 1.45 percent tax payment for Medicare. Earlier this year, the Trump administration used its authority to delay the due date for 2019 federal income taxes, pushing it back to July 15.
He added in the interview “the Democrat states—they don’t want to open up anything. They don’t want their schools open, they don’t want their businesses open, they want to keep it shut, and you can’t do that.”
Michael Graetz, a professor of tax law at Columbia University, told CNBC that a president only has the ability to postpone payroll taxes. “He doesn’t have the authority to forgive the taxes,” said Graetz. “Only Congress can do that.”
For the past several weeks, Democrats and Republicans have been at an impasse over a new stimulus package that is designed to offset losses incurred during the CCP (Chinese Communist Party) virus pandemic.
Federal unemployment benefits of $600-per-week ended last week, and days before that, a federal moratorium on evictions ended. Republicans have proposed a $200-per-week initial benefit that would later replace 70 percent of workers’ wages.
The White House is seeking to provide another round of $1,200 stimulus payments and extending the supplemental jobless benefit and partial eviction ban. House Speaker Nancy Pelosi (D-Calif.) appears intent on an agreement as well, but she’s made it clear she needs big money for state and local governments, unemployment benefits, and food aid.
“It was productive, we’re moving down the track. We still have our differences, we are trying to have a clearer understanding of what the needs are, and the needs are that millions of children in our country are food insecure,” Pelosi said earlier this week. “Millions of people in our country are concerned about being evicted. Tens of millions of people are on unemployment insurance.”
“I can’t see how we can go home and tell people we’ve failed, so I think that’s going to be a lot of pressure on everybody to come up with something,” said Sen. John Cornyn (R-Texas). “It really is a matter of will. It’s not a matter of substance at this point. This is just a painful period between people finally deciding OK, we want a deal, and then what that deal will ultimately look like.”
The Associated Press contributed to this report.
