More NewsOver Half of US Finance Professionals Say Tax Hikes Necessary Part of Deficit Agreement

Over Half of US Finance Professionals Say Tax Hikes Necessary Part of Deficit Agreement

Finance professionals overwhelmingly believe that clear action must be taken on deficit reduction to accelerate economic growth in 2012, and more than half think that tax increases should not be taken off the table to achieve a deficit reduction agreement, according to a survey by the Association for Financial Professionals (AFP).

The 2012 AFP Business Outlook Survey, underwritten by SunTrust, found that financial professionals believe the US economy will continue to strengthen modestly in 2012, with a median expected growth rate of gross domestic product (GDP) of 1.9%. Nevertheless, a full two-thirds reject the need for additional fiscal stimulus (QE3).

While the largest percentage of financial professionals since December 2006 is anticipating that their organisations will add staff to their payrolls in 2012, they are expecting a relatively modest net gain in payrolls of only 1.1 million for the entire US economy.

Financial professionals continue to point to uneven consumer demand, business investment and demand for US goods and services overseas as important factors affecting economic growth and job creation in 2012. They also believe these key factors will influence business conditions in 2012:

  • Managing health care costs (76%).
  • Federal budget deficit (71%).
  • Uncertainty surrounding tax policy (71%).
  • Sovereign debt crisis in Europe (71%).
  • Weak housing demand (70%).
  • Success of efforts to reduce long-term budget deficits (70%).

“CFOs and treasurers are sending a clear message: enough!” said Jim Kaitz, AFP’s president and chief executive officer (CEO). “These are practical people. They recognise that the political theatre must stop in order to achieve a resolution of the debt crisis.”

Internationally, financial professionals also are concerned about the ongoing sovereign debt crisis in Europe. Just over half of financial professionals indicate that their organisation has been affected financially by the sovereign debt crisis in Europe: 35% of organisations experienced a detrimental impact, 18% a beneficial impact. Nearly half of those surveyed expect dissolution of the euro sometime within the next three years.

Related Articles

Infosys Finacle to power Santander UK’s international cash management system

More News Infosys Finacle to power Santander UK’s international cash management system

3w The Global Treasurer
Preparing for GDPR? Here’s four things to consider

More News Preparing for GDPR? Here’s four things to consider

4m Elliott Wiseman
Cash flow in focus for investors

Cash Management Cash flow in focus for investors

5m Conor Deegan
Treasury TV: Karen Pugsley, Domino's Pizza Group

More News Treasury TV: Karen Pugsley, Domino's Pizza Group

5m Victoria Beckett
Treasury TV: Yeng Butler compares US and European MMF reforms

Compliance Treasury TV: Yeng Butler compares US and European MMF reforms

5m Victoria Beckett
Treasury TV: Tim de Knegt, The Port of Rotterdam

10 Minutes With The Treasury Treasury TV: Tim de Knegt, The Port of Rotterdam

5m Victoria Beckett
Banks are selling clients short with short dated cash deposit U-turns

Banking Banks are selling clients short with short dated cash deposit U-turns

5m Victoria Beckett
What does sterling’s Brexit boost mean for UK manufacturers?

More News What does sterling’s Brexit boost mean for UK manufacturers?

6m Tasja Botha