Banaian: Social Security Tax Increase to Have Big Impact Locally [AUDIO]
ST. CLOUD – Most workers will still be paying more in taxes, despite the bill passed by Congress that staves off the “fiscal cliff”. That’s because the budget deal, which averts widespread income tax increases, does nothing to stop the Social Security tax increase. That means a $1,000 tax increase for someone making $50,000 a year.
St. Cloud State Economics professor King Banaian says that will result in a hit to the local economy this year.
The bill passed this week did not address federal government spending, which sets-up another big battle in February when the debt ceiling will need to be raised by $16.4 trillion, or the federal government will risk defaulting on it’s bills.
Banaian says the good news is, for the time being the stock market has stabilized, because the tax rates have been established. But, he says stock will becoming volatile again, as we get closer to the fight over the debt ceiling.