President Barack Obama marked this year’s tax filing deadline at a White House event to promote the tax cuts included in the stimulus bill. While the president addressed reporters in the Old Executive Office Building, a few hundred protestors across the street braved pouring rain and slippery mud to participate in one of the many tea party protests taking place around the country. “We’ve passed a broad and sweeping tax cut for 95% of American workers. This tax cut was a core focus of my campaign, it was a core component of the American Recovery and Reinvestment Act, and it is the most progressive tax cut in American history,â€ Obama said. “And, starting April 1st, Americans saw this tax cut in the extra money that they took home with each paycheck.â€
The stimulus bill, which Congress passed in February, includes a $400 payroll tax cut for individuals and $800 for couples. Obama estimates that this paycheck tax cut will benefit 120 million people and put $120 million into their pockets. He also said it will save or create a half-million jobs.
Another provision in the legislation allows small businesses to offset their losses against their income for five rather than two years. “This could provide a record number of refunds for small businesses, which will provide them with the lifeline they need to maintain inventory and pay their workers,â€ Obama said.
Keith Moore, president of the consulting firm KDM & Associates, says that it’s too early to tell how beneficial the small business provision will be, although it seems promising. He’s far more concerned, however, about frozen credit markets than tax credits. “As long as TARP funds are being tunneled into the largest banks and they continue to not lend to small businesses, I’m afraid the charge Obama wants to lead will be continuously hampered,â€ said Moore.
Chuck Marr, director of federal tax policy at the Center on Budget and Policy Priorities, said Obama chose Tax Day to talk up the stimulus bill because this is a time when the federal government has to step in to cut taxes and spend more because consumers, businesses, and state and local governments are pulling back.
A group of conservative leaders, including former attorney general Edwin Meese and Grover Norquist, who heads Americans for Tax Reform, issued a statement before the White House event that said, “There is no justification for the countless billions that citizens will have to pony up this tax season to fund liberalism’s reckless abuse of the federal treasury. At exactly the time when working families could use a break, the Obama regime and the liberal Democrats in Washington and state capitals are burdening them into a future of even more onerous tax days.â€