The leadership of both parties in both chambers want to pass an extension of the payroll tax break, but all of the relevant details have led to a predictable partisan standoff. A bipartisan duo — Sens. Claire McCaskill (D-Mo.) and Susan Collins (R-Maine) — presented a compromise plan today intended to pick up at least some Republican votes.
Brian Beutler walks us through the outline:
It renews the current two percent payroll tax cuts for workers and extends a 2 percent cut to employers as well, on their first $10 million of payroll. In other words, it does not deepen the existing payroll tax for employees.
It provides a tax credit for young, U.S.-based tech businesses, and renews other expiring business tax credits. It would provide $10 billion to state governments and require them to use the funds to seed state-based infrastructure banks, and provide an additional $25 billion in highway and bridge funding. To win GOP support, the legislation would delay for at least 15 months EPA rules meant to prevent industrial boilers and incinerators from emitting harmful toxins and pollutants — and impose other new regulatory requirements on federal agencies.
But, and this is key, it will be paid for exclusively with higher taxes: a two percent millionaires tax that carves out an exemption businesses that file as individuals, and a repeal of tax subsidies for the five largest oil companies in the country.
I’m generally not pleased when McCaskill starts reaching compromises with GOP senators, but this one could have been worse.
Obviously, a large chunk of the Republican caucuses will refuse to even consider any plan that asks more of millionaires and billionaires, but the principal GOP talking point has been about small-business taxes. The McCaskill/Collins compromise eliminates that concern.
If we were dealing with sensible Republicans who were willing to compromise, this would pass rather easily.
But we’re not. Senate Minority Leader Mitch McConnell (R-Ky.) has already signaled his opposition to the bipartisan deal, and the likelihood that House Republicans would go for this is hard to even fathom.