President Donald Trump wants to eliminate the payroll tax rate for employers and employees for the rest of the year as part of an economic stimulus package to fight back against the coronavirus outbreak and the financial crisis.
Trump and his staff have been working on an economic stimulus package throughout the week amid a fluctuating stock market that saw the Dow Jones Industrial Average fall more than 2,000 points. The slide triggered a 15-minute halt to pause the fall. Trump met with a group of Republican senators Tuesday, but according to NBC, the White House was not ready to roll out a specific plan to respond to the virus or the financial turmoil.
“Be calm. It’s really working out,” Trump said after the meeting, according to NBC. “A lot of good things are going to happen.”
For Social Security, employees are subject to a payroll tax rate of 6.2% up to $137,000. For Medicare, employees are subject to a payroll tax rate of 1.45% tax and employers match the contributions.
Republican and Democratic senators are skeptical of the tax cut because payroll taxes fund Social Security and Medicare.
On Tuesday, the Dow rose by 1000 points by the end of trading. Trump has been criticized from all sides due to his lack of urgency in response to the virus and for his contradictions to the advice given by officials at the Centers for Disease Control and Human Health Services.
The White House is also considering assisting the oil, cruise, and airline industries, which have been hit hard due to people traveling less and the oil price war between Saudi Arabia and Russia.
Since the outbreak, 28 people have died in the United States and more than 800 citizens across the country have been infected. Both rates have increased daily. Worldwide, more than 118.000 people have been affected by the virus resulting in more than 4,200 deaths. Last month, health officials indicated that two-thirds of the world’s population could be affected.
The last time payroll taxes were cut was during the Obama administration. In February 2009, President Barack Obama included a $400 payroll tax cut for individuals and $800 for couples as part of a stimulus bill package.