Treasury Secretary Steven Mnuchin. (Photo:AP)

Treasury Secretary Steven Mnuchin said Thursday morning that thenext coronavirus relief package will not include apayroll tax cut.

"We think the payroll tax cut is a very good pro-growth policy,but the president's focus is he wants to get money into people'spockets now, because we need to reopen the economy," Mnuchin saidon "Squawk Box," a CNBC program. "One of the issues I think youknow about the payroll tax cut is people get that money over time.So the president's preference is to make sure that we send outdirect payments quickly so that in August, people get moremoney."

The previous direct payments "worked before," Mnuchin continued,as "retail sales was up year-over-year 1 percent. People went outand spent that money in small businesses, and that's having a bigimpact in the economy. So, as I said, it's all about getting moneynow for kids and jobs."

A payroll tax cut, Mnuchin said, "won't be in the base bill,"which will be called CARES 4.0, but "there could be CARES 5.0." TheGOP is expected to release the bill Thursday, according to The WallStreet Journal.

Unemployment Benefits

As to unemployment benefits, the enhanced unemployment insuranceexpires next week, "so that's a priority; we need to respond tothat," Mnuchin said. "As we've said before, we're not gonnacontinue within its current form because we're not going to paypeople more money to stay at home than work, but we want to makesure that the people that are out there that can't find jobs do geta reasonable wage replacement, so it will be based on approximately70 percent wage replacement."

Republicans said Wednesday afternoon that they were consideringextending the enhanced unemployment insurance benefit "at adramatically reduced level of $400 per month, or $100 a week,through the rest of the year," CNBC reported.

The current federal benefit of $600 per week is set to expire atthe end of July. The payment is in addition to state joblessbenefits.

A lot of tax credits will also be provided, he continued, "toincentivize companies to hire people."

As to the Paycheck Protection Program (PPP), Mnuchin stated that"there's a lot of bipartisan support for extending the PPP. I'vehad conversations with [Sens.] Cardin and Rubio, and we want tohave second checks for companies whose revenues are down 50 percentor more, and who need more money to get people back to work."

From: ThinkAdvisor