Deadlock of payroll tax comes to an end
23rd December: US House Speaker John Boehner finally melted down to provide short-term extension of payroll tax cut.
The move comes as Boehner felt isolated from many of his fellow Republicans and severe attacks not just from congressional Democrats but even from President Barack Obama.
Boehner revealed in a statement that he agreed with Harry Reide, Senate Majority Leader for providing two-month extension of payroll tax cut.
He further maintained that such a move will make sure that working families do not have to bear the burden of increased taxes on January 1, 2012.
He further stated that Senate will be joining the House for working on the agenda of full-year payroll tax extension in the coming weeks.
He hinted at getting a unanimous consent of this agreement by the Senate and the House before 25th December. Reid, meanwhile, warned in this statement that there are some vital differences between the two parties with regard to implementation of such policies.
He, however, hoped that negotiations in the two months period will help in forging year-long extension to such vital policies.
Boehner’s two month renewal of payroll tax cut for nearly 160 million US workers means a saving of $20 a week or additional take-home salary of $200 for any worker making an average of $60,000.
The recent developments are said to be a big win for the president. The Senate and the House have plans to act on the two-month payroll tax extension this Friday and the legislation will be forwarded to the president.
Welcoming the development, President Obama said its is a great news and in perfect tune with the holidays time. It will strengthen families, create new jobs in the US and give a stimulus to the US economy, Obama asserted.
Democrats want to impose a new payroll tax on any income above $1 million. Meanwhile, Republicans are in favor of cutting the bringing reductions in the federal workers along with decreasing pay for federal workers. In addition, they also intend to provide extension of payroll tax cut and unemployment benefits.