Rebate Checks Give Consumer Income, Spending a Boost
- Jun 27, 2008
Washington, D.C.–The tax rebate checks provided by the economic stimulus package raised consumer income and savings in May, according to the government. The roughly $50 billion worth of tax rebates–sent out in April and May–also increased consumer spending.However, without the rebates, income levels would have increased only a little, the New York Times said Friday. Wage growth did not keep up with inflation.After being adjusted for inflation and without counting the tax rebates, after-tax income rose 0.4 percent in May, according to the Commerce Department. Including the rebates, income increased 1.9 percent; after-tax income grew 5.3 percent.After declining 0.1 percent in April, wages and salaries rose 0.3 percent, but inflation increased more–0.4 percent–in May, which means U.S. consumers really earned less.Consumer spending also rose 0.4 percent as a result of the rebate checks.