NEW YORK — About a quarter of consumers surveyed said they anticipated spending some or most of the savings they will receive through the one-year payroll-tax reduction effective Jan. 1, according to a poll by the International Council of Shopping Centers and Goldman Sachs.
About 16% of consumers said they would spend some of the extra take-home pay, and 9% said they would spend most of it. The tax reduction, which reduces workers' withholding rate to 4.2% to from 6.2% for Social Security taxes, would put an extra $800 in the pockets of consumers earning $40,000 a year in 2011.
About 27% of respondents to the survey, which polled 1,000 households, said they were not sure what they would do with the extra money, and 26% said they would use it to pay down debt. Most of the rest said they would add the money into their savings.
"Consumers may change their minds as 2011 unfolds, but this ICSC-GS survey suggests that consumers — who have thought about it — are largely cautious on the use of that extra take-home pay," said Michael P. Niemira, ICSC's vice president for research and chief economist.
ICSC estimated that the tax cut would boost 2011 consumer spending by 0.5% to 0.75% for the year.