Republicans plan House OK of payroll tax cut bill

WASHINGTON (AP) — The White House promised a veto Tuesday for a Republican bill renewing a payroll tax cut next year for 160 million workers, complaining that spending cuts that pay for the measure would whack the middle class and require no sacrifice from the rich.

The threat came as the House began debating the bill, which would also extend long-term unemployment benefits and prevent a cut in Medicare payments to doctors. The GOP-led chamber was expected to approve the legislation later Tuesday, though it was virtually certain to die in the Democratic-run Senate.

Obama had previously objected to a provision in the bill forcing work on a proposed oil pipeline that would stretch from Canada to the Gulf Coast, which Obama wants to delay. Tuesday’s veto threat was more strongly worded and broadened his objections to the bill’s unfair treatment of low- and middle-income earners, a theme that has become a dominant one for Democrats as the two parties position themselves for next year’s elections.

“If the president were presented with H.R. 3630, he would veto the bill,” the statement said, referring to the number of the legislation.

Republicans said the legislation underscored their effort to create jobs and said the Senate could not simply ignore the legislation.

“The Senate can take up our bill and amend it, or they can pass their own bill. But they can’t continue to shirk their responsibility to govern. America can’t wait,” said Michael Steel, spokesman for House Speaker John Boehner, R-Ohio.

The White House statement said the measure, whose price tag exceeds $180 billion, “seeks to put the burden of paying for the bill on working families, while giving a free pass to the wealthiest and to big corporations by protecting their loopholes and subsidies.”

Democratic versions of the legislation, backed by Obama, would have been largely paid for by boosting taxes on people earning more than $1 million annually, a proposal Republicans have ignored.

The House legislation is partly financed by requiring higher earners to pay larger premiums for Medicare and preventing the wealthy from collecting jobless benefits and food stamps.

But far more savings come from other proposals, including extending a pay freeze on civil servants and forcing them to contribute more to their pensions, paring some spending under last year’s health care overhaul and boosting fees that federally run Fannie Mae and Freddie Mac charge for backing mortgages.

Democrats complain that the bill does not do enough for unemployed people coping with one of the worst U.S. economies in decades. The bill prevents extra benefits for the long-term unemployed from expiring on Jan. 1, but would gradually wind down maximum coverage to 59 weeks, well below the current 99-week ceiling.

The measure would make other changes in the unemployment program, including giving states the right to administer drug tests to applicants for benefits.

The bill would retain this year’s 4.2 percent Social Security payroll tax rate paid by workers in 2012, preventing it from popping back up to its normal 6.2 percent on Jan. 1 if Congress doesn’t act. Obama got Congress to reduce the tax a year ago in an effort to leave more money in peoples’ wallets and prod the limp economy, and GOP leaders pushing to renew the tax break next year have had to overcome objections from some Republicans who say it has done little to revive the economy.

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