WASHINGTON (MarketWatch) — House Republicans accepted a short-term payroll-tax cut bill Thursday, ending a stalemate that threatened to raise taxes on 160 million workers come Jan. 1.
After a day of behind-the-scenes discussions, Speaker of the House John Boehner announced late in the afternoon that the House will vote on a Senate-passed bill that would extend the 4.2% payroll tax for two months with some new wording tacked on to assist payroll processors.
Because of this new language, the Senate must vote again on the bill.
Boehner said that the House and Senate would approve the new package before Christmas without a recorded vote.
In a statement, President Barack Obama called the deal “good news.”
“Because of this agreement, every working American will keep his or her tax cut – about $1,000 for the average family. That’s about $40 in every paycheck,” Obama said in a statement.
Without action by Congress, taxpayers would have lost that extra cash starting on Jan. 1.
House Republican leaders had pressed for a one-year extension and said as recently as Thursday morning that that was the only bill they would accept.
But pressure had been building on House Republicans to change course.
Senate Republicans, some of the party’s presidential candidates and at least two House freshmen urged their leaders in the afternoon to accept the short-term bill while they bargain for a longer-term measure.
“This isn’t about proving a point. This is about preventing hardworking Wisconsin families from paying an extra $40 a week for the dysfunction in Washington,” said one, Rep. Sean Duffy.
Under the agreement, Senate Democrats will appoint conferees to meet with House members in the weeks ahead on a full-year extension of the tax cut.
In a brief press conference, Boehner said the deal fixes problems in the Senate bill. The new wording allows businesses to use the same accounting structure that is currently in place to process the tax cuts.
Boehner said he was prepared to bring the House back for a formal vote if any member objected to a voice vote.
“I am proud of the efforts [our members] put into this,” Boehner said.
Source; http://www.marketwatch.com/story/deal-emerging-on-two-month-payroll-tax-cut-2011-12-22?link=MW_pulse
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