The US Congress passed a two-month payroll tax cut extension eight days before its scheduled expiration after House Republicans dropped their objections under growing political pressure.
The plan will go to President Barack Obama for his signature. It would extend a two-percentage-point payroll tax cut, continue expanded unemployment benefits and head off a reduction in Medicare payments to doctors through February. Lawmakers plan to negotiate on a longer-term extension in the new year.
“I hope this Congress has had a very good learning experience, especially those who are newer to this body,” Senate Majority Leader Harry Reid, a Nevada Democrat, told reporters after his chamber’s action on Friday. “It seems that everything we’ve done this past year has been a knock-down, drag-out fight. There is no reason to do that.”
The agreement kicks the dispute over extending the tax cut for 160 million U.S. workers into early next year without resolving deep divides over how to cover the cost through 2012.
Democrats are seeking to raise taxes for high-income Americans while Republicans want to cut the federal work force and freeze pay for government workers. Republicans also want to attach policies to a payroll tax cut extension -- opposed by Democrats -- such as a rewrite of the unemployment system or weaker rules for industrial emissions.
