SPENDING OF INCOME TAX REFUNDS BOOSTS ECONOMY.Byline: Louis Uchitelle Louis Uchitelle is a journalist and author.[1] He has worked for the New York Times since 1980, where he writes about business and economics.[2] He was the lead reporter for the series The Downsizing of America, which won a George Polk Award in 1996. The New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Times An early surge in income tax refunds is giving Americans billions of extra dollars to spend this spring, which helps to explain the revival in the economy now in progress. The tax refunds, $52.1 billion through the end of March, are turning out to be a shot in the arm for the economy - indeed, the latest of several temporary shots in the arm that may well make the second quarter, just getting started, the strongest period of growth this year. ``The refunds are definitely showing up as car down payments,'' Wynn Van Bussman, an economist at Chrysler Corp., said, ``and that is stimulating sales.'' The tax refunds, along with several other special effects special effects, in motion pictures, cinematographic techniques that create illusions in the audience's minds as well as the illusions created using these techniques. , could lift economic growth in the second quarter to an annual rate of 3 percent or so, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. some forecasters, including those at the President's Council of Economic Advisers. But as these booster shots wear off by midsummer, economic growth will probably scale back, closer to a 2 percent rate. ``The odds of a spurt in activity later this year are not that high,'' said Joel Prakken, a partner at Lawrence H. Meyer & Associates, an economic consulting firm Noun 1. consulting firm - a firm of experts providing professional advice to an organization for a fee consulting company business firm, firm, house - the members of a business organization that owns or operates one or more establishments; "he worked for a in St. Louis. The boosters come from several sources. Apart from the tax refunds, warmer weather has removed an obstacle to the shopping and construction that snowstorms and floods had postponed in the first quarter. Auto manufacturers raised production quotas for April to make up for lost days during the General Motors strike last month. And the drop in interest rates that lasted through 1995, bringing down mortgage and auto loan rates, is still helping the economy, economists said, with many Americans making purchases on credit before borrowing gets too costly again. Interest rates began to creep back up in January. The surge in tax refunds became evident in data made available by the IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. this week. During March, the number of refund checks authorized by the IRS rose to 41.6 billion from 17 billion on March 1, and the total amount of those checks jumped to $52.1 billion from $24.2 billion at the end of February. The dollar total represented a rise of 25 percent compared with the first three months of last year, when tax refunds were delayed. But even discounting for last year's delays, the refunds are up by more than 10 percent, or roughly double the normal rise of 5 percent or 6 percent a year. ``Unequivocally, more tax refunds are flowing into the economy than is normal,'' said William Dudley William Dudley was Dean of Windsor and then Bishop of Durham. He was nominated to Durham probably on September 1, 1476. He was consecrated between September 1 and October 12 1476. He died November 24, 1483.[1] Notes 1. , director of economic research at Goldman Sachs The Goldman Sachs Group, Inc., or simply Goldman Sachs (NYSE: GS) is one of the world's largest global investment banks. Goldman Sachs was founded in 1869, and is headquartered in the Lower Manhattan area of New York City at 85 Broad Street. & Co. CAPTION(S): 3 Charts Chart: (1-3--Color) Lifting the Economy? Federal incometax refunds as of March 31 each year. The New York Times |
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