Senate Republicans and the White House have agreed in principle on a new stimulus bill to help Americans and shore up the economy in the midst of the coronavirus, and Treasury Secretary Steven Mnuchin says the package will mirror the one in March, which gave millions of Americans $1,200.
“We’re talking about the same provision as last time, so our proposal is the exact same proposal as last time,” Mnuchin told reporters, according to The Hill. He said direct payments to Americans will be the same as set out in the $2.2 trillion bill signed into law in late March.
Lawmakers at the Capitol said Senate Majority Leader Mitch McConnell (R-KY) is set to release the plan on Thursday. Senate Appropriations Committee Chairman Richard Shelby (R-AL) announced a “fundamental agreement” on the funding levels, The Washington Times reported.
Under the March bill passed by Congress, individuals were eligible for payments of up to $1,200, but that amount declined for those with an adjusted gross income higher than $75,000 a year, based on their 2018 tax filings. The $1,200 payment dropped by 5% of every dollar above $75,000, or $50 for every $1,000.
The benefit didn’t apply for individuals with incomes over $99,000.
Married couples with combined incomes of up to $150,000 received $2,400, subject to the same phaseout that applied to individuals. The payments were phased out entirely for couples making $198,000 or more. Families also got $500 per dependent child under the age of 16. About 120 million U.S. taxpayers qualified for direct payments from the federal government under the bill.
But the cap will be lowered, according to reports.
“The decision to stick to the March formula is a shift from over the recess, when [McConnell] appeared to signal that while Republicans would support another round of checks, the next round would include a lower income cap of around $40,000,” The Hill reported.
“I think the people that have been hit the hardest are people who make about $40,000 or less. Many of them work in the hospitality industry. … That could well be a part of it,” McConnell told reporters in Kentucky during the two-week recess, said The Hill.
Speaker of the House Nancy Pelosi (D-CA) opposed the lowering of the cap. “I think families making over $40,000 probably need assistance … depending on their family situation,” she said, according to The Hill.
Mnuchin said a payroll tax cut, which President Trump pushed in earlier negotiations on the bill, will not be part of the new legislative package. He said the president’s “priority for the moment is to get money into Americans quickly, and one of the problems with the payroll tax cut is it takes time.”
The package is expected to include $70 billion for schools, $30 billion for colleges and universities, and $5 billion for governors to spend at their discretion. It will also call for $16 billion in new funding for testing, plus $9 billion that was approved in March, but not spent.
“We’ll have $16 billion in a line tomorrow, and $9 billion that previously was not as clearly designated that they already had will now be clearly designated as testing, so the total testing money will be $25 billion,” Sen. Roy Blunt (R-MO) told reporters, according to the Times.