By Brittany Pieper – email
SHREVEPORT, LA (KSLA) –After a long fight between both political parties, President Barack Obama signed legislation that will extend tax cuts for all Americans. It will also help the unemployed and give much-needed financial relief. It extends the Bush era tax cuts, and cuts the payroll tax by 2% for a year. The average tax payer will take home anywhere from $500-$1,000 more next year because of this new tax package, and Ark-La-Tex residents say it's welcome relief.
"That's great. That'll buy more groceries and pay more bills. That's what everybody needs," said Wayne Pearson.
Centenary College Economics Professor David Hoaas says most of the tax package targets the middle class. Someone who makes $50,000 will take home an extra $1,000. However, Hoaas says this doesn't necessarily mean you'll have extra spending money.
"With rising prices, particularly transportation and anything related to gasoline prices, most individuals really, this is gonna help them net out in terms of their budget at the end of the year. So, is this a great thing where at the end of the year you're going to have much more money left when you're sitting here at Christmas time 2011? No, but at least you're going to be in the same position," said Hoaas.
Democrats, who originally opposed continuing tax cuts for the wealthy, allowed the cuts across the board. They also restored the estate tax at a lower rate. Hoaas says this will likely impact less than 7,000 Americans.
The bill also helped those in the lowest tax bracket. It will extend unemployment benefits for 13 months. Ed Hughens lost his job this summer. He says he hopes he doesn't have to use that extension, but it's comforting to know it's there.
"Thirteen more months is gonna give some of the less fortunate workers a cushion. It'll give them a safety net in that they're not gonna have to worry about how they're gonna feed their family, how they're gonna pay their mortgage, how they're gonna pay their car note," said Hughens.
The tax bill passed with largely bi-partisan support. Many of those who did oppose it stated concern over the federal deficit.