Senate Majority Leader Harry Reid, D-Nev., said Senate Democrats are working on a backup plan to extend the payroll-tax cut for a full year. He is concerned that a House-Senate conference committee might not make the Feb. 29 deadline to extend the payroll-tax cut.
A bill to extend the payroll-tax cut passed along party lines in the House on Tuesday. However, Senate Majority Leader Harry Reid, D-Nev., said the Senate will reject it because it includes the Keystone XL oil pipeline. The Senate will have its own bill.
House Speaker John Boehner, R-Ohio, received support from other Republicans for a bill that would extend a payroll-tax cut that expires at year-end. The bill also calls for quicker approval of an oil pipeline from Canada, and fewer restrictions on industrial emissions. President Barack Obama has said he would to veto a payroll-tax bill that includes the oil pipeline provision. Senate Majority Leader Harry Reid, D-Nev., backs a different version that would pay for the tax cut with a surtax on annuals income of more than $1 million.
Senate Majority Leader Harry Reid, D-Nev., wants to change a House-passed measure that would repeal a requirement that governments withhold 3% of payments to contractors. Reid wants to ensure that it would apply only to contractors that are current on their tax obligations. Such a change would have to go back to the House for another vote. If Reid’s proposal is adopted, federal, state and local governments might have difficulty determining whether a contractor is tax-delinquent.
An amendment by Sen. Harry Reid, D-Nev., would postpone until 2011 an annual tax on health insurers and medical-device makers. Drugmakers, which face a $2.3 billion levy starting next year, were not included in the proposal.