Fiscal Cliff frightens Tampa Bay residents and tourists - WFLA News Channel 8

Fiscal Cliff frightens Tampa Bay residents and tourists

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It all sounds so frightening, fiscal cliff, automatic tax hikes, devastating budget cuts.

Word out of Washington is that the White House and congressional republicans agreed to block those planned across the board tax increases. But the deal to avoid the fiscal cliff just isn't done.

As one member of Congress stated, there is something very wrong when the biggest threat to the American economy is the American Congress.

"Why did they let this happen? Why did it get to this point, why have we reached this fiscal cliff," asked Diane North of Tampa.

Because Congress can not agree on what is best for America, taxes, tax cuts, spending increases or spending decreases.

"I think Mitch McConnell is orchestrating all of this to embarrass the president and he's embarrassing himself in the process," said Joe Kendall of Flint, Michigan, who is in town for the Outback Bowl.

If nothing gets done by the start of the New Year, brace yourselves. Tax hikes totaling more than $500 billion dollars start going into effect. Another $109 billion will be cut from government budgets, including defense.

Kendall says he isn't all that worried about it.

"I don't think it means very much to me because I am a retiree, I'm 77 years old, I have pensions, social security. I don't think that they're going to be touched," he said.

Unless things change, beginning at midnight January first, at the Hillsborough County Sheriff's Office, higher taxes will mean an average 5 percent less take home pay.

Diane and Frank North of Tampa worry about cuts to medicare and other social programs.

"I'm definitely concerned it will decrease my paycheck, because there's be a bigger tax burden," Diane North said.

"There's going to definitely be an impact, how bad we just don't know yet," Frank North guessed.

The tax hikes coupled with the budget cuts equals the so called fiscal cliff.

Economists warn, together, they could dip the U.S. right back into a recession.

Joe Tinsey of South Carolina, also in town for the game, fears what's ahead.

"I have everything I own in the stock market. I understand it's going to hit bottom Wednesday, it's going to be bad for me," Tinsey speculated.

But Tampa C.P.A. Kristen Brand warns this is no time to panic.

Brand says once Congress decides what's changing and what isn't, you've got until 2014 to figure out how to pay for a tax increase.

"And there are ways to reduce your taxable income, net income through employer sponsored plans. For instance if you have a 401-K that will reduce that number down so you can pay yourself some of that money," Brand said.

But before you can plan, before you can prepared, Congress needs to get off its high horse and come up with a workable agreement.

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