Americans who are likely to receive government-funded rebates are most likely to use the money to pay off debt, according to a consumer survey by the International Council of Shopping Centers, Inc.
The survey, commissioned by UBS Securities and conducted between Jan. 31 and Feb. 3, asked 1,000 Americans what they would do with the money if the legislation was signed into law: increase spending or increase savings or pay off debt. Forty-three percent of respondents said they would use the money to pay off debt; 26 percent said they would put the money into savings and 24 percent said they would spend it.
“Consumers see this tax rebate program similar to earlier ones and will act in a similar fashion using the lion’s share of the rebate money for debt relief,” said Michael P. Niemira, ICSC chief economist and director of research. “Lenders will see the money before retailers do. But still, about $25 billion will head into the spending stream and that is positive for the economy.”
With the United States facing a recession, the U.S. House of Representatives passed legislation that would put in the hands of the consumer, $600 for individuals and $1,200 for couples (single people with income of up to $75,000 and married couples with income of $150,000 or under would qualify). The bill is now in the Senate.