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CNN Live Sunday

New Yorkers Prepare for Christmas in July -- Tax Rebates

Aired June 03, 2001 - 16:15   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
DONNA KELLEY, CNN ANCHOR: So, what you are planning to do with this little gift from Washington. You're not going to be able to buy a new house with it, unless you paid a lot of taxes, but a rebate is a rebate.

CNN's Brian Palmer talks to some taxpayers in New York.

(BEGIN VIDEOTAPE)

BRIAN PALMER, CNN CORRESPONDENT (voice-over): The checks aren't even in the mail yet, but people across the country are already making plans for the tax rebate, up to $300 for singles and $600 for couples they could receive from Uncle Sam this summer.

(on camera): What would you do with the money?

UNIDENTIFIED FEMALE: Knowing myself, I'd probably blow it because I'm not a saver.

UNIDENTIFIED FEMALE: My plans would be to use it toward probably a payment on my mortgage.

UNIDENTIFIED MALE: Pay off some bills and maybe fill my car full of gas for a change.

UNIDENTIFIED MALE: I plan to invest.

PALMER (voice-over): But some question the logic of a rebate. Ken Moody of Sacramento would rather the government hold on to the money.

UNIDENTIFIED MALE: It doesn't go to Washington and stay there. If we build roads, it goes to the people that build roads. If we put it into schools, it goes to teachers.

PALMER: Robin Davney (ph), a mother of four from Virginia, thinks the rebate is a good idea.

UNIDENTIFIED FEMALE: It's a start. I feel like it's a start with Bush helping those that need the extra help.

UNIDENTIFIED FEMALE: Give it back. Cut down government. Make it smaller.

PALMER (on camera): Now, these guys aren't taxpayers, are they?

UNIDENTIFIED MALE: No, they're tax deduction.

PALMER (voice-over): New Yorker Mike Cassel (ph) says the rebate won't mean that much to his family.

UNIDENTIFIED MALE: I'm sure I'll just spend it on living expenses and go on with my life. I've got five kids. That's $120 a kid, so where are you going with it?

PALMER: There's also some little examined fine print on the plan. Roughly 34 million of the nation's 95 million taxpayers won't receive rebates, according to Citizen for Tax Justice a non-partisan research group.

(on camera): That's because the rebate is based on how much income tax you pay. Payroll taxes, which all working Americans pay, don't count. That means that nearly 75 percent of Americans in the lowest tax brackets won't be getting rebate checks at all.

Brian Palmer, CNN, New York.

(END VIDEOTAPE)

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