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Rich Votes Again For a Full-Year Extension of Payroll Tax Cut

Press Release

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"Following the same process that Congress has used since the beginning, the House voted formally today to "go to conference' with the Senate over the payroll tax legislation. Why did we vote to do that? The Constitution set up two chambers within the legislative branch and they did it for a reason. They set up the government so that nothing could become law without both chambers passing the exact same legislative language. And throughout our history, when differences have arisen, Congress has used this process to resolve differences between the House and Senate. That's what we are doing today. In order for it to work, however, the Senate must also formally appoint conferees and direct them to work out a compromise with the House. Senate Majority leader Harry Reid has made it clear that he has no intention of doing that. Instead, he insists that the House accept, without amendment, the bill that the Senate has passed. He has, in short, refused to ask his conferees to return from vacation to work out an agreement with the House.

"There are real-world consequences to this. The disagreement between the House and Senate is about whether to extend the payroll tax cut and other provisions for eight weeks or for the whole year. The House, the President, and before they were against it, the Senate all agreed that the extension needed to be for a year. Anything short of that causes uncertainty for families and undue compliance costs for payroll processors. Enough has been said about the obvious desire of the Senate -- both parties -- to go home for the holidays instead of staying in Washington and hammering out a compromise. The House passed a full one-year extension a week ago, giving the Senate plenty of time to pass their own one-year extension, as requested by the White House. It didn't happen. We're making a good faith effort to reconcile the differences now, but we can't do it alone.

"The House has voted affirmatively to guarantee the average working family a thousand dollar tax cut next year. The Senate, on the other hand, has voted to give American families a hundred and sixty dollar tax cut and promised them the rest when they get around to it. I'll put it this way: I've got two sons just back from Iraq and there is nothing I want more than to be home spending time with them. But I'm willing to stay in Washington and work it out, because the American people deserve the certainty of knowing what their finances are going to look like after the holidays. That's what we were elected to do."

**Below, please find a list of organizations and the statements they have released regarding the damage of a two-month extension.

Associated Builders and Contractors (ABC), writing on behalf of construction-related firms with nearly 2 million employees:

"[T]he proposed two month stop-gap measure merely serves to delay the inevitable tough decisions, compounding the climate of uncertainty that continues to impact small businesses...Instead of passing the buck for another two months, the House and Senate must work together to determine their policies for the full year and provide some semblance of certainty for the companies driving our economy."

Associated General Contractors of America (AGC), writing on behalf of more than 5 million people employed in the construction industry:

"Members of the AGC tend to be small businesses…This legislation will extend the payroll tax holiday in the most complex way possible, at the busiest time possible, provide little benefit to taxpayers and unfairly hit the small member companies of the Associated General Contractors of America (AGC) the hardest."

National Federation of Independent Business (NFIB), the nation's largest small business advocacy association representing 350,000 small business owners:
"The two month payroll tax holiday would present a number of complications and costs that would disproportionately affect small businesses…[M]any small employers do payroll processing in-house by hand, and this would require them to spend time to make these changes. Employers that do not have correct withholding calculations would need to figure out how much more to collect from employees and amend employment tax returns later in the year, which may also increase their chances for an audit."

National Payroll Reporting Consortium (NPRC), whose member organizations provide payroll processing to over 1.5 million employers nationwide, covering over one-third of the private sector work force:

"[W]e believe there is insufficient lead time to accommodate the proposal embodied in H.R. 3630. In our opinion enactment of HR 3630 as written could create substantial problems, confusion and costs affecting a significant percentage of U.S. employers and employees. The difficulty is in establishing a new Social Security Taxable Wage limit of $18,350 for the two month extension period."

National Roofing Contractors Association (NRCA), writing on behalf of its 4,000 members:

"…NRCA is concerned that the proposed two-month extension would cause 'substantial problems, confusion and costs' for employers. As the NPRC states, many payroll systems would simply not be able to make the programming changes that the proposed two-month extension would require. This would impose an undue burden on employers in the form of logistical difficulties and costs."

Small Business & Entrepreneurship Council (SBE), on behalf of its 100,000 members:

"The confusion that the two-month extension would impose on employers or their payroll providers will inevitably divert resources away from productive activities. Indeed, the uncertainty regarding what happens next following the two-month expiration date will serve as additional fuel to currently low business confidence levels...Individual Americans and entrepreneurs need to plan, and they are tired of these short-term fixes. The two-month extension is unacceptable."

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