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House GOP chairman: Payroll tax cut will be extended
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12/02/11 08:44 PM ET
A leading House Republican says lawmakers will find a way to extend payroll tax relief and unemployment benefits by year’s end.
Rep. Fred Upton (R-Mich.), the chairman of the House Energy and Commerce Committee, said his party will demand that the cost of extending the two items be offset with deficit cuts elsewhere.
“It's still a working project, as we talk now,” Upton told Bloomberg Television. “The keys, particularly from the Republican side, are that these have to be paid for. We're not going to increase the size of the deficit.”
Upton also told Bloomberg’s “Political Capital with Al Hunt” that he did not think Republicans are currently on the short end of the political battle over the payroll tax cut.
But congressional Republicans do appear deeply divided over whether to extend the current yearlong payroll tax relief, which expires at the end of this month.
Meanwhile, the White House and Democrats in both chambers are hammering the GOP for considering letting the tax cut expire, saying that would be akin to a tax hike. House Republican leaders are pressing their rank-and-file to get behind an extension of the tax break, saying that the GOP should not play a part in letting taxes rise.
“The impact is in January, and our leadership is committed to extending the tax cut, not raising taxes, therefore, but finding the offsets,” Upton said in his Bloomberg interview.
Republican leaders presented lawmakers with a slew of items that could possibly be used to extend the current cut, which slices the payroll tax rate from 6.2 percent to 4.2 percent.
But some House Republicans said after the meeting that they were struggling to balance the desire to keep money in Americans’ pockets with the long-term health of Social Security. The payroll tax funds the entitlement program, and general Treasury funds would be used to make up for any revenues diverted from Social Security by the tax cut.
Some in the GOP ranks have also expressed some skepticism that the current payroll tax cut has generated much economic growth.
On Thursday, the majority of Republican senators voted against a GOP proposal to extend the tax cut for another year, which would have primarily been offset with savings wrung from the federal workforce.
The Senate Democratic plan for a deeper payroll tax cut – down to 3.1 percent – that would have also been extended to employers also failed to clear a procedural hurdle on Thursday. The Democratic proposal would have been paid for with a surtax on millionaires.
In recent days, Democrats have cited economic analysts who have said that not extending payroll tax relief would be a major hit to the economy, and have said they have seized the political advantage in the tax debate.
Rep. Fred Upton (R-Mich.), the chairman of the House Energy and Commerce Committee, said his party will demand that the cost of extending the two items be offset with deficit cuts elsewhere.
“It's still a working project, as we talk now,” Upton told Bloomberg Television. “The keys, particularly from the Republican side, are that these have to be paid for. We're not going to increase the size of the deficit.”
Upton also told Bloomberg’s “Political Capital with Al Hunt” that he did not think Republicans are currently on the short end of the political battle over the payroll tax cut.
But congressional Republicans do appear deeply divided over whether to extend the current yearlong payroll tax relief, which expires at the end of this month.
Meanwhile, the White House and Democrats in both chambers are hammering the GOP for considering letting the tax cut expire, saying that would be akin to a tax hike. House Republican leaders are pressing their rank-and-file to get behind an extension of the tax break, saying that the GOP should not play a part in letting taxes rise.
Republican leaders presented lawmakers with a slew of items that could possibly be used to extend the current cut, which slices the payroll tax rate from 6.2 percent to 4.2 percent.
But some House Republicans said after the meeting that they were struggling to balance the desire to keep money in Americans’ pockets with the long-term health of Social Security. The payroll tax funds the entitlement program, and general Treasury funds would be used to make up for any revenues diverted from Social Security by the tax cut.
Some in the GOP ranks have also expressed some skepticism that the current payroll tax cut has generated much economic growth.
On Thursday, the majority of Republican senators voted against a GOP proposal to extend the tax cut for another year, which would have primarily been offset with savings wrung from the federal workforce.
The Senate Democratic plan for a deeper payroll tax cut – down to 3.1 percent – that would have also been extended to employers also failed to clear a procedural hurdle on Thursday. The Democratic proposal would have been paid for with a surtax on millionaires.
In recent days, Democrats have cited economic analysts who have said that not extending payroll tax relief would be a major hit to the economy, and have said they have seized the political advantage in the tax debate.
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