The signing of the latest fiscal cliff agreement may be a sigh of relief for most, but 7.1 million Floridians -- many of whom just got a raise -- may not like the outcome.
Though touted as a way of preventing taxes from going up on most Americans, the cliff bill did not renew a Social Security payroll tax reduction that according to a Herald/Times report will cost Floridians an estimated $6.5 billion.
That's because without the payroll tax reduction, the percentage of wages deducted from salaried employees will increase from 4.2 to 6.2 percent in 2013. It's a difference of about $1,000 per year for a worker making $50,000 annually.
Florida's minimum wage earners could be hit the hardest, with their new year's 12-cent raise all but wiped out by the legislation.
The minimum wage increase was expected to put an additional $200 to $500 dollars in the pockets of low-wage earners, but as HuffPost's David Jamieson reports:
According to the Wall Street Journal's payroll tax calculator, a worker who makes $15,000 a year -- roughly the salary of a full-time, minimum-wage worker in most states -- will pay an additional $300 in payroll taxes this year under the deal struck by Congress and the White House.
The temporary payroll tax holiday was signed by President Obama in late 2010 signed for the temporary tax holiday in late 2010 as a way to stimulate the ailing economy. House Republicans in Congress balked carrying its 2011 extension into 2012, but eventually voted to pass.
The tax increase could be worse: although the demise of the payroll tax extension means a few dollars less per paycheck for over three-quarters of Americans, the deal did extend Bush-era tax cuts for Americans making less than $450,000.