Time is Running Out on the Payroll Tax Extension

Further payroll tax relief may have to wait.  Most Americans who have been following the story probably thought a two-month extension of the payroll tax cut was the best that could be arranged for now and it was a done deal.  In fact, after the Senate approved the measure on Saturday, they left Washington for their holiday break.  But not so fast — it still had to get past the House in today’s vote . . . and it didn’t.

Today the House voted 229-193 in opposition to the two-month extension.  This has the effect of kicking the measure back to the Senate, but Senate Majority Leader, Harry Reid, refuses to continue negotiations on a long-term deal until the House approves the preliminary one.  Here is the way he spins it:

I have been trying to negotiate a yearlong extension with Republicans for weeks, and I am happy to continue doing so as soon as the House of Representatives passes the bipartisan compromise to protect middle-class families, but not before then.

~ Senate Majority leader Harry Reid, D-Nev

If something isn’t done before the end of the year, then the payroll taxes will go up by 2 percentage points in January and nearly 2 million people could lose unemployment benefits.


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