Trump Threatens Executive Action on Payroll Tax Cut, Unemployment Benefits if Congress Fails to Pass COVID Relief Bill

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President Trump indicated he would sign executive orders on Friday or Saturday that would extend unemployment benefits and institute a payroll tax holiday, amid continuing deadlock in Congress over coronavirus economic relief.

Trump also told reporters on Thursday that he was looking into extending a federal moratorium on evictions as well as unspecified student debt relief. If signed, the orders would set up a legal fight over the president’s authority to institute the measures. The payroll tax would likely be illegal, since Congress is the only branch of government that has the authority to make tax cuts.

“For tax policy to make a big difference it’s got to be long term,” Senator Chuck Grassley (R., Iowa) said of Trump’s comments. “I’m not going to advise anything until I find out whether he thinks he’s got the legal authority to do it.”

Grassley added, “I assume [Trump is] contemplating it to send a signal that he is sick and tired that Democrats are not negotiating,” and that Trump may not be serious about signing the orders.

Congress has not been able to agree on a new round of legislation to provide economic relief from the effects of the pandemic.

Senate Republicans have offered legislation amounting to roughly $1 trillion in aid, including new loans for small businesses and an additional round of stimulus checks to Americans.

House Democrats are demanding an extension of $600-per-week enhanced federal unemployment benefits, along with additional aid that gives their legislation a $3 trillion price tag.

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