U.S. Treasury secretary Steven Mnuchin has proposed a $1 trillion economic stimulus package and announced the IRS will extend its April 15 tax payment deadline by up to 90 days to help counteract effects of the coronavirus pandemic, according to news reports.
Mnuchin pitched the stimulus proposal — which would include loans, direct payments to individuals and a boost in liquidity for small firms — to Republican senators during the GOP’s annual policy lunch Tuesday, according to CNN. The first round of direct payments would be $250 billion, a source familiar with the matter tells the TV news channel.
Mnuchin confirmed the aggregate figure, adding that President Donald Trump’s proposal would infuse trillions of dollars into the economy, CNN reports.
"It is a big number," he said, according to the news channel. "This is a very unique situation in this economy."
The Trump administration is discussing what cap to put on as far as who is eligible for the direct cash benefit, but it will likely be available only to those earning less than $100,000, sources tell CNN. The benefit may be restricted to anyone making $75,000 or less, according to the TV news channel.
The overall proposal, which was first expected to be around $850 billion, could include $500 billion in payroll tax breaks, $250 billion in small business loans and up to $60 billion in grants and loans to the airline industry, a person familiar with the matter tells Bloomberg.
Other ideas discussed by Mnuchin included speeding up the application process for a line of credit from a bank that would be collateralized by the Treasury, Alfredo Ortiz, president of the conservative Job Creators Network, said, according to the news service. Currently, Small Business Administration loan applications take three to five months, according to Ortiz, Bloomberg writes.
Earlier, Sen. Mitt Romney, R-Utah., had proposed sending every American adult around $1,000, and Sen. Todd Young, R-Ind., said he was open to the idea, CNN writes. When asked about the proposal, Mnuchin indicated limited support for it, according to the TV news channel.
"I think it’s clear we don’t need to send people who make a million dollars a year checks. But we like — that’s one of the ideas we like. We’re going to preview that today and then we’ll be talking about details afterwards," Mnuchin said, according to CNN.
Trump said there would likely be limitations on which Americans would be eligible for the cash benefits.
"I think we’re going to do something that gets money to them as quickly as possible. That may not be an accurate way of doing it because obviously some people shouldn’t be getting checks for $1,000,” he said, according to the TV news channel. “But we’ll have a pretty good idea by the end of the day what we’re going to be doing."
Meanwhile, Senate Majority Leader Mitch McConnell, R-Ky., has asked a group of senators to put together a stimulus plan similar to Mnuchin’s proposal, GOP sources tell CNN. At a news conference earlier on Tuesday, McConnell said that Republican senators plan to agree on a bill with Trump’s administration and then negotiate with the Democrats, according to the TV news channel.
The $1 trillion proposal, however, may meet resistance from the Democrats, CNN writes. Senate Minority Leader Chuck Schumer, D-N.Y., was planning to discuss an estimated $750 billion proposal on a conference call with Democratic senators on Tuesday, a Democratic leadership aide tells the news channel. He was also planning to address the differences between the Democrats and Republicans’ plans, CNN writes.
Meanwhile, Mnuchin also announced a 90-day deadline extension for paying federal income taxes due on up to $1 million, according to CNBC. The secretary floated the idea of an extension earlier this month, saying it would apply to “virtually all Americans, other than the super-rich.”
The extension would also apply to many pass-through entities and small businesses, he said, according to CNBC. Additionally, corporations will get the same extension on up to $10 million in owed taxes, Mnuchin said, the TV news channel writes. During the 90-day period, taxpayers will be exempt from interest and penalties, according to Mnuchin, CNBC adds.
However, the extension does not apply to state taxes, although some states, including California and Maryland, have already granted delays in light of the coronavirus, according to CNBC.
The virus has infected at least 198,366 people in 164 countries and territories and caused the death of at least 8,418 as of Wednesday morning, with according to Reuters. In the U.S., at least 5,881 have tested positive for the virus and at least 107 have died as of Wednesday morning, according to the New York Times.
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