Middle class families cannot afford a $1,000 tax hike right now. And small businesses looking to expand shouldn’t have a higher tax burden next year.
But that’s exactly what would happen if Congress fails to extend the Payroll Tax Cuts – first passed in 2009 – which are set to expire on December 31st of this year.
Right now, the United States Senate is considering an extension of the payroll tax cut – which puts more money back in the pockets of hard-working, middle class Americans who work hard and play by the rules. And it would also expand the payroll tax cut to include the small business owners.
I’m fighting to pass the Middle Class Tax Cut Act – legislation that would extend and expand the payroll tax cut, providing an average Ohio household with a tax cut of $1,430 next year. If Congress fails to pass the Middle Class Tax Cut Act, the payroll tax rate would skyrocket from 4.2 percent to 6.2 percent on January 1st.
What will it mean for Ohioans if the payroll tax cut isn’t extended?
Bob, a small business professional in Franklin County, recently wrote to me about the “economic uncertainty that prevents customers from spending money (or having money) to put back into the economy in the form of purchases of goods and services from small businesses.” He summed up his letter with a simple question: “Doesn’t anyone get it?”
Ohioans know that allowing citizens to keep more money in their pockets will allow them to pay rising food and energy costs, pay their rent or mortgage, and contribute to the local economy by buying goods and services.
For an electrician or a plumber making about $50,000 annually, the Middle Class Tax Cut Act would not only preserve an existing $1,000 tax break, but it would also put an additional $550 a year in their pockets. If Congress fails to pass this commonsense legislation, the average nurse would see about $1,000 in additional taxes next year. If Congress fails to act, then we risk squandering an opportunity to help more than 5.7 million Ohioans take home more of their paycheck.
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