US extension of payroll tax cut & unemployment benefits risk new recession

in International Business

US extension of payroll tax cut & unemployment benefits risk new recession

The Congressional Budget Office (CBO) in its report on the economic forecast has said that the US would see growth drop by 2.9% in the first half of next year, with unemployment rate stuck at above 8%.

Fiscal tightening, including changes to tax and spending policies would cause the US to tip back into recession in 2013.

The main reason for the gloomier forecast was due to an extension of a payroll tax cut and federal unemployment benefits.

In February of this year, the US congress voted in favor of extending a payroll tax cut until the end of 2012 that would save middle-class Americans some USD 1,000 a year.

The CBO warned that the US must avert “fiscal cliff” that would otherwise take the US back to recession in 2013.

US fiscal cliff

  • Expiring tax-rate reductions and tax credits originally enacted in 2001, 2003 or 2009
  • Sharp cuts in Medicare payments to doctors
  • Automatic, across-the-board cuts to discretionary and mandatory federal spending included in the 2011 Budget Control Act
  • Expiring emergency unemployment benefits and a 2% payroll tax cut for Social Security


Related Articles

Iran continues uranium enrichment as they have in the past- Iranian Legislator

Iranian lawmaker Alaeddin Boroujerdi denied reports that the Islamic Republic had temporarily halted enriching uranium to the 20% level. Previously,

'Ferrari of trains' puts Italy on fast track

Privately-funded service set to offer luxurious high-speed travel between Milan and Naples. Ferrari president, Luca di Montezemolo, is an ambitious man.

China rail audit reveals millions lost on fraud

Millions of dollars have been embezzled from the Beijing-Shanghai high-speed rail link project, China’s state news agency Xinhua reports. Audit

No comments

Write a comment
No Comments Yet! You can be first to comment this post!

Write a Comment

Your e-mail address will not be published.
Required fields are marked*

cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china Cheap eBooks Buy eBooks Online Discount eBooks Cheap eBooks Buy eBooks Online Discount eBooks Cheap eBooks Buy eBooks Online Discount eBooks cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china cheap nba jerseys from china wholesale nba jerseys from china discount nba jerseys from china