The rebate check proposal included in the economic relief bill Senate Republicans released Thursday would cost nearly $250 billion in 2020, according to the Tax Foundation, a Washington, D.C., think tank.
The GOP measure includes a plan to send $1,200 checks to individuals earning less than $75,000 and $2,400 to couples earning below $150,000 to help them weather the disruption caused by the coronavirus.
The checks, however, would be limited to income tax liability for tax year 2018, meaning that lower-income families would not get the full $2,400. Individuals with minimal income would only receive a rebate of $600. From there, the rebate would dollar-for-dollar with tax liability until it reaches its maximum at $1,200.
Republican Sens. Mitt Romney of Utah and Josh Hawley of Missouri have objected to the rebate checks on the grounds that they don’t go far enough.
President George W. Bush included rebate checks in his 2008 stimulus bill. Individuals earning less than $75,000 received a check up to $600 and joint filers earning less than $150,000 received double that, or up to $1,200. The checks were projected to cost the federal government $108 billion, according to the Joint Committee on Taxation, the organization charged with tallying the cost of congressional tax proposals.
The Tax Foundation report also shows that the rebate checks under discussion in the Senate would increase after-tax income for lower-income earners by 7.11%. The increase of after-tax income on average would be 2.05%.
