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Paulsen Praises Passage of Bill Repealing 3% Withholding Tax

Press Release

Location: Washington, DC

Representative Erik Paulsen (MN-03) released the following statement after the passage of H.R. 674, a bill to repeal the 3% withholding rate for government contractors. In 2006, Congress created a rule which required the government to withhold 3% on certain payments made to contractors doing work with federal, state and local governments in hopes that it would increase compliance. The rule was originally slated to go into effect on January 1, 2011, but concerns about the requirement have caused that date to be postponed to January 1, 2013.

"This is another area in which Republicans and Democrats are working together to improve the economy, as even President Obama has singled out this provision as "burdensome' to our nation's job creators," said Rep. Paulsen. "I'm pleased that this bill has passed as it would hinder a wide array of industries, including hospitals, companies providing school lunches and contractors working to improve our infrastructure."


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