Reid files cloture on payroll-tax cut bill

Senate Majority Leader Harry Reid (D-Nev.) on Wednesday filed a cloture motion to proceed on the latest iteration of President Obama’s summer jobs bill — the payroll-tax cut. 

The cut — or officially The Middle Class Tax Cut Act, S. 1917 — would cut the employee and employer payroll tax to 3.1 percent, half of the 6.2 percent tax they would normally face. The bill applies this cut to the first $5 million in payroll for companies, which Senate Democrats estimate will cut payroll taxes in half for 98 percent of U.S. companies with payrolls below that cap.

The bill also includes a “surtax on millionaires,” which applies a 3.25 percent tax on modified adjusted gross income higher than $1 million, or $500,000 for a married individual filing separately. This tax would take effect in 2013.

Sen. Bob Casey Jr. (D-Pa.) is the chief sponsor of the bill, which is also co-sponsored by Reid and Sens. Sherrod Brown (D-Ohio), Robert Menendez (D-N.J.), Charles Schumer (D-N.Y.) and Debbie Stabenow (D-Mich.).