The issues of taxes roiled the Democratic party on Monday, with several members staking out ground in the debate.

Four House Democrats are circulating a draft letter asking Speaker Nancy Pelosi (D-Calif.) for a vote on extending the Bush-era tax cuts for one year, a central issue in the November election. 

"We urge you to consider legislation to extend all of the income tax cuts," the letter to Pelosi reads, CBS reported Tuesday. "In recent weeks, we have heard from a diverse spectrum of economists, small business owners, and families who have voiced concerns that raising any taxes right now could negatively impact economic growth. Given the continued fragility of our economy and slow pace of recovery, we share their concerns."

Several proposals have cropped up on Capitol Hill in recent days — House Republicans are calling for a combined spending freeze at 2008 levels and extending tax cuts for two years.

Senate Minority Whip Jon Kyl (R-Ariz.) on Monday said a Senate Finance Committee markup on the Bush-era tax cuts is unlikely to occur even though there appeared to be an agreement to have one before lawmakers left for the August recess. 

"We agreed we were going to have a markup as soon as we got back," he told reporters. "Now I'm hearing there is not going to be a markup — something comes directly to the floor." 

Several House Republicans made another push Monday for Congress to cut spending back to 2008 levels and to extend Bush-era tax cuts before lawmakers leave town for the November elections. 

House Appropriations ranking member Jerry Lewis, (R-Calif.), Ways and Means ranking member Dave Camp (R-Mich.) and Budget ranking member Paul Ryan (R-Wis.), sent a letter today to the chairmen of their respective panels "requesting an immediate, bipartisan effort to cut government spending back to 2008 levels and stop pending tax hikes on all Americans."

The letter asks Democrats and Republicans to work together to "enact legislation this month that cuts federal spending back to 2008 levels for the next year and provides certainty for small businesses by freezing all tax rates at their current levels for the next two years."

The spending freeze would affect fiscal 2011, which begins Oct. 1. 

As Congress looks to tackle the extension of Bush-era tax cuts before the election, recent polls indicate many voters support ending the breaks aimed at wealthier taxpayers. 

While a new poll by Rasmussen shows 51 percent of voters support the extension of all the tax cuts, it also found 44 percent of respondents believe breaks should be extended for everyone but the wealthy. 

With the Senate moving forward on small-business legislation this week, a new report shows lending and the amount of loans has declined this year, as hiring has remained flat and the smallest firms reduced hiring. 

The number of loans made to small businesses, which peaked at 27.2 million in the second quarter of 2008, has fallen by more than 4.8 million since then, a drop of 17.8 percent. The total value of those loans fell by $60 billion to about $650 billion, according to a report released Monday by the Joint Economic Committee (JEC) with data through May. 

The smallest businesses — those with fewer than 50 employees — had drops in hiring, even as large and mid-sized firms began to increase hiring in the middle of last year, the report said.

The Senate is expected to pass a small-business bill that would provide $12 billion in tax breaks.

The Defense Department's acquisition chief is expected to announce several measures to make military contracts more cost-effective.

House Ways and Means Committee ranking member Dave Camp (R-Mich.) on Monday called for Speaker Nancy Pelosi (D-Calif.) to allow a vote on Republicans' tax plan that would extend all of the Bush-era tax cuts for two years.