Nevertheless, tax-cut dogma still governs the GOP. Trump's memorandum deferring payroll taxes is a campaign ploy to claim credit for putting more money in American's pockets. But unless Congress changes the law, taxpayers will still owe the money. So Trump is posing a nasty choice:
- Make taxpayers accept a huge balloon payment on the deferred taxes;
- Partially defund Social Security and Medicare, thereby speeding up their insolvency.
Tami Luhby at CNN:
President Donald Trump's executive action deferring, and possibly forgiving, payroll taxes could leave Social Security and Medicare on even shakier ground.
The entitlement programs' finances have long been troubled. And the crush of coronavirus-induced layoffs has only deepened the problem by slashing the amount of payroll tax revenue going into their trust funds.
A big fan of payroll tax cuts, Trump signed an executive action Saturday deferring the employee portion of payroll taxes -- 6.2% for Social Security and 1.45% for Medicare -- for workers making less than $100,000 a year through the rest of 2020.
If he's reelected, Trump said, he plans to forgive the taxes and make permanent cuts to the payroll taxes.
"I'm going to make them all permanent," he said.
Otherwise, presumably, workers would have to pay the taxes at the end of the year.
Today, Donald Trump stated that if re-elected, he'll undermine the entire financial footing of Social Security.— Joe Biden (@JoeBiden) August 9, 2020
Our seniors and millions of Americans with disabilities are under enough stress without their hard-earned Social Security benefits in doubt. https://t.co/glUDQlcbEO