US House Lawmakers Reject Senate FICA Payroll Tax Cut Bill

Lisa Ferdinando

December 21, 2011

The Republican-led U.S. House of Representatives has rejected Senate legislation to extend a payroll tax cut for two months, leaving the prospect that 160 million Americans will see a tax increase at the start of the new year. The vote provoked angry responses from the White House and Democratic legislators.

Lawmakers on Tuesday traded barbs and blamed each other in heated debate, just days before the payroll tax cut will expire.

In a vote of 229 to 193, the House voted Tuesday to set aside the bill and requested a formal conference with the Senate to work out the differences.

After the vote, President Barack Obama expressed his frustration and accused Republicans of playing politics.

"We have more important things to worry about than politics right now. We have more important things to worry about than saving face or figuring out internal caucus politics. We have people who are counting on us to make their lives just a little bit easier," said Obama.

But Republicans said the House previously did its part and passed legislation to extend the payroll tax cut for one year, while the Senate's two-month extension offers only uncertainty and a temporary fix.

The top House Republican, Speaker John Boehner, said the Democratic-led Senate took the easy route in the rush to leave town for the Christmas break. He said he wants to give the average family a $1,000 tax cut for 12 months as President Obama has requested.

"I just think the American people expect us to do our work," said Boehner. "We've got 10 days to do our work. We can resolve the differences between the House and Senate bill. Everybody wants this extended for a year. But it just happens to be inconvenient for some to try to resolve it at this point. Why? Because we're getting close to the holidays."

Fellow Republican, Majority Leader Eric Cantor, said the remainder of the year could be used to come to agreement so taxes would not increase at the beginning of the year.

"So far, the House has passed a bipartisan, year-long plan to ensure that taxes do not go up," said Cantor. "The Senate, on the other hand, has passed a two-month plan. According to experts, the two-month plan is simply unworkable. Families, employers and workers can't live their lives month-to-month. Washington needs to stop adding confusion and more uncertainty to people's lives."

The legislation also extends unemployment payments to jobless workers and prevents cuts in payments for health care for the elderly.

The leader of the minority Democrats in the House, Nancy Pelosi, said the legislation is crucial. She noted it enjoyed broad support in the Senate and charged that House Republicans never wanted the payroll tax cut. She said that now the legislation is before them, they claim the length of the tax cut is too short.

"Ninety percent of the Senate in a bipartisan way voted for this tax cut," said Pelosi. "It is just the extreme Tea Party element of the Republicans in the House of Representatives who are standing in the way of a tax cut for 160 million Americans, unemployment benefits for millions of Americans and Medicare opportunity for 48 million seniors."

The Senate on Saturday overwhelmingly approved the two-month extension, and then its members left town for the holidays. Senate leaders have indicated they will not call the chamber back into session to negotiate a new bill on the payroll tax.