To deal with the economic consequences of theÂ CCP coronavirusÂ outbreak, the Trump administration has announced that individuals and businesses can delay the payment of their tax bills for the year. In addition, measures like supplemental income and corporate loans have also been proposed. Â
Tax and income
âIndividuals will be able to delay paying up to US$1 million in payments. Corporations will be able to defer payment on up to $10 million. Taxpayers will still have to file their tax returns by the April 15 deadline. But they wonât have to pay their tax bill for 90 additional days. During that time, individuals and corporations will not be subject to interest or penalty payments,â according toÂ The Epoch Times.
The plan will potentially enable American taxpayers to keep US$300 billion circulating in the economy. Treasury Secretary Steven Mnuchin has asked taxpayers to keep filing returns on time since many people will receive refunds that they can use to cover their expenses during an economic slowdown. According to Mark Zandi, the Chief Economist at Moodyâs Analytics, the tax delay will only act as a temporary measure to cushion the economy from distress.
The White House has also put forward a US$2 trillion plan to stimulate the economy under the “Coronavirus Aid, Relief, and Economic Security Act.” It proposes giving individuals US$1,200 and couples US$2,400 provided that they are beneath a certain income level. Some US$300 billion has been earmarked for providing loans to small businesses that are obliged to use the money to pay for things like mortgage payments, salaries, healthcare benefits, and so on. Businesses can procure these loans from lenders who would be guaranteed by the Small Business Administration.
There has been criticism against the economic stimulus, with some arguing that handing out US$1,000-plus checks to American people would be a waste. Instead, that amount should be given to businesses that will retain the employees and keep paying their salaries. “I personally think that if we’re going to help people we should direct the cash payments maybe as a supplemental to unemployment, not to the people who are working every day, just a blank check to everybody in America making up to US$75,000â¦ I don’t see the logic of that,â Sen. Richard Shelby, the Alabama Republican who chairs the Appropriations Committee, said toÂ CNN.
California has announced a state quarantine, with Governor Gavin Newsom requesting people to stay at home. The order will remain in effect until “further notice.” The quarantine regulations wonât be enforced through law enforcement. Instead, the authorities are betting that citizens would act responsibly and follow the quarantine rules.
“There’s a social contract here. People, I think, recognize the need to do more and to meet this momentâ¦ People will self-regulate their behavior, they’ll begin to adjust and adapt as they have been quite significantlyâ¦ We will have social pressure that will encourage people to do the right thing,” Newsom said, as reported byÂ CNN.