The Republican-controlled House of Representatives passed an amended version of the two-month payroll tax cut extension Friday, following approval in the Senate, and sent it to President Obama for his signature.
The measure passed in both chambers by unanimous consent, a procedural move allowing the measure to go forward even though most members of Congress are home for the holidays.
Obama is expected to sign the bill shortly, handing a defeat to House Republicans and wrapping up a legislative year marked by repeated partisan brinksmanship and declining public approval of a seemingly dysfunctional Congress.
House and Senate members are now expected to resume negotiations on a year-long extension of the tax cut when Congress reconvenes in January.
GOP leaders first questioned the merit of the tax cut and then complained that a short-term extension would be more trouble than it’s worth, but Obama used the standoff to portray the Republicans as de fenders of the rich with a callous attitude toward the burdens of the middle class.
House Speaker John Boehner, R-Ohio, finally succumbed Thursday to calls from across the political spectrum for House Republicans to stop blocking congressional approval of the bipartisan two-month extension previously approved by the Senate.
Under the deal, the payroll tax will remain at the current 4.2% rate instead of reverting to the 6.2% rate it was at before the cut was enacted last year. Without congressional action, the higher rate would have returned in 2012, meaning an average $1,000 tax increase for 160 million Americans. The typical worker's take home salary will shrink by about $40 per pay period without the tax cut.
The agreement also includes the addition of legislative language to ease the administrative burden on small businesses implementing the plan, and a commitment to the negotiations on a one-year extension of the payroll tax cut as well as other benefits.
