The House of Representatives rejected, 229-193, on Tuesday the Senate bill to extend the payroll tax cut for two months as well as unemployment benefits. If Congress can’t break the logjam, 160 million Americans will pay higher taxes next year.
Senate Majority Leader Harry Reid, D-Nev., said after the vote that, “It is unconscionable that Speaker [John] Boehner is blocking a bipartisan compromise.”
Reid shot off a letter to Boehner on Wednesday urging him to reconvene the House and approve the Senate’s bipartisan compromise “as soon as possible” to avoid a middle-class tax increase on January 1.
“Once the House of Representatives acts on this immediate extension, we will be able to sit down and complete negotiations on a longer extension,” Reid wrote. “But because we have a responsibility to assure middle-class families that their taxes will not go up while we work out our differences, we must pass this immediate extension first.”
President Barack Obama, in an impromptu news conference after the House vote on Tuesday, said that the Senate compromise that was supported by both parties in the Senate as well as the White House “is the only viable way to prevent a tax hike.”
A White House web page explains that as it stands now, workers contribute 4.2% of their wages to Social Security. “The normal rate is 6.2%, and if the House of Representatives doesn’t take action, that’s what we’ll pay in 2012,” the web page says. That would mean that a typical American family making $50,000 a year pays $1,000 in extra taxes next year.