2011 might be Steve Raye’s best year.
It might be the year he gets to give his employees more hours.
It may also be the year he breaks even.
Raye, or “Satchel” as customers have come to know him at Satchel’s Pizza, is one of millions of workers affected by the $858 billion tax break package that signed into law by President Barack Obama on Dec. 17.
The bill carries over Bush-era tax cuts, which were scheduled to sunset on Dec. 31, preventing an increase in taxes for another two years.
Raye said he started in 2009 at 20 percent below the amount of money he was used to making. Since then, he has seen a slow uptick in the number of weekly customers. By the end of 2010, he had almost 50 workers on an average Friday night and customers streaming out the door waiting for pizza.
And with the tax-cut extension, he believes business may continue to pick up.
Among other measures aimed at stimulating economic growth, the package will reduce the Social Security tax by two percentage points, extend 99-week unemployment benefits until the end of the year and continue a cut in payroll tax.
Had the bill not passed, workers would have seen an average of 4 percentage points tacked on to their taxes this year, said David Denslow, professor and director of policy studies in the Warrington College of Business Administration at UF.
President Obama said at the signing ceremony that the bill would ultimately create more jobs for Americans.
That’s what Linda Tanner, owner of Alachua Farm and Lumber on the corner of Main Street Northwest 145th Avenue, is hoping for.
She said Alachua Farm and Lumber hasn’t been hit hard enough by the economy since it last laid off employees in 1984. But, because the company won’t be paying the taxes it would have, she said she could be looking for new hires in 2011.
She said she’s optimistic that families with the extra $3,000 in would-be tax dollars will spend their money at the store.
“Perhaps people will feel better about spending and going on business as usual,” Tanner said.
That consumer optimism was the goal of the bill, Denslow said. If the bill works as expected and workers use the tax break, he said, the bill would reduce the chance of the economy falling into a double-dip recession.
Instead, it would take a slow and steady nose up.
“It’s not that we’re expecting great times again,” Denslow said. “We’re just reducing the chance of it getting worse.”
Over at Satchel’s, Raye said the tax cuts may help steer around a recession, but he’s not sure he can attribute his line of customers to decisions made in Washington, D.C.
“Is that going to happen just because of tax cuts? Who knows?” He asked. “That extra 20 bucks might be the 20 bucks they get a pizza with.”
