Will Tax Rebate Stimulus Checks Refund The Economy?

The government is giving the consumers a stimulus tax rebate in the hope that we will all rush out and spend the checks in a frenzy and that will then kick start the stuttering American economy.

I don’t think so. More likely with banks increasing the interest rates and tightening controls on lending, we will use the tax rebate stimulus checks to pay a few bills and keep some to one side in case of emergencies in the next few months.

People have had almost 9 months of credit crunch news and it keeps getting blacker and blacker. The full impact of the credit crisis, the sub-prime loan scandal and the bankers venal greed has yet to become clear, so anyone who spends the rebate in an orgy of denial would indeed be considered very foolish.

The federal government, deadly keen to boost the flagging economy, will start distributing the special tax rebates on Monday - five days earlier than expected. If only they could have delivered them on the weekend. We’d be more likely to forget our responsibilities on a Friday night - poor planning there, George old boy!

Tax Rebates Schedule

Now, 800,000 tax filers will get the checks of the stimulus tax rebates on Monday, Tuesday and Wednesday. No tax rebates will be distributed on Thursday, and 5 million payments will be made on Friday.

Overall, the Treasury is scheduled to distribute tax rebate stimulus checks to more than $110 billion to 130 million taxpayers by July and hopes to get the first $50 billion out by the end of May, said Treasury spokeman.

This money still doesn't compare to the billions being pumped into the economy by the Fed to pump up the banks, and keep them afloat after their dodgy business deals went wrong, but why should the ordinary tax payer expect more? After all the system isn’t there to benefit us.

What if the government instead could use tax rebate prepaid cards, like debit cards, that people could only spend and not cash. Could this kind of a stimulus package be a better solution to U.S. Economy?

Source: By Letmeeatcake Blogger