ARLINGTON, Va. — Retail Industry Leaders Association president Sandy Kennedy has responded to the White House report predicting the massive tax increases consumers could face if policymakers fail to avert the fiscal cliff.
The report was authored by the National Economic Council and the National Council of Economic Advisors.
“Today’s report underscores enormous challenges that consumers and retailers will face if the White House and Congress are unable to work together to address these critical issues. The White House and Congress must work together to address the fiscal cliff; if they fail to do so, the strong opening to this year’s holiday shopping season will soon be a distant memory as consumers prepare for a massive tax increase,” said Kennedy.
Consumers are likely to feel the effects of the fiscal cliff long before they actually reach it. In 2011, when Congress and the White House fought over an increase to the debt ceiling, consumer confidence plummeted. According to figures from Thomson Reuters and the University of Michigan, during the debt ceiling debate consumer sentiment reached near historic lows and took more than five months to rebound to pre-debate levels.
The White House report highlights the important role that the retail industry plays in the economy. “The business of selling goods and services to millions of Americans is critical to the broader economy,” the report reads. “The retail industry employs 14.8 million Americans, and has been a key part of the recovery. In the 40 months since the recession ended in June 2009, the retail industry alone has been responsible for more than 9 percent of overall employment growth and has added 438,000 jobs in the past 32 months.”