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Payroll tax cut extension vote scheduled for late Monday

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WASHINGTON (AP) — House Republicans are set to vote down the Senate's two-month payroll tax bill and seek negotiations with the Senate, sources tell the Associated Press.

Congressional leaders say the debate over this bill is a make-or-break moment for John Boehner. (Photo: ABC News)

Congress is facing yet another down-to-the wire showdown as House Republicans shun a bipartisan payroll tax cut bill approved by the Senate and prepare to write a package to please rank-and-file GOP lawmakers clamoring for a more conservative version.

The House was returning to work Monday, two days after the Senate easily approved a compromise solidly supported by both parties and left town for a month. The House scheduled a vote late Monday, with leaders saying they would either formally request talks with the Senate on a new bill or make changes in the Senate measure that were uncertain late Sunday.

Without congressional action, the payroll tax would rise 2 percentage points on Jan. 1 — a boost that Democrats eagerly said would be the GOP's fault. The brinksmanship is a familiar pattern this year between the two parties, who have narrowly averted a federal default and several government shutdowns in past fights.

Extending the payroll tax cut and jobless benefits have been a keystone of President Barack Obama's and congressional Democrats' effort to spur a revival of the flaccid economy. Congressional Republican leaders also say they support the idea, but some of their rank-and-file remain unconvinced, saying the unemployment coverage is too generous and that cutting the payroll tax does not create jobs.

The Senate bill would cut the payroll tax, extend jobless benefits and avoid cuts in Medicare payments to doctors through February. Both sides say they want to renew all three for a full year, but bargainers have so far failed to agree on how to pay for a package that size, which could cost roughly $200 billion.

White House communications director Dan Pfeiffer said opposition from the House Republican leadership was risking a tax increase for 160 million Americans. But he insisted there was still an opportunity for the House to pass the Senate-approved two-month extension.

"You only need a couple dozen Republicans to do it," Pfeiffer said. "I find it inconceivable that you can't get a couple dozen Republicans to vote for a tax cut for the middle class."

Sen. Charles Schumer of New York, the Senate's No. 3 Democratic leader, said Boehner's speakership faced a "make-or-break moment."

"You cannot let a small group at the extreme resort to brinksmanship every time there is a major national issue and try to dictate every move this nation makes," he said.

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