Last week, Congress passed two spending bills. This week the House is faced with a tax-cut dilemma.
With a temporary spending bill expiring, Congress last week passed a bill to fund the government for the remainder of fiscal year 2012. H.R. 2055, a military spending bill now called the Consolidated Appropriations Act, 2012, spends about $8,800 per U.S. family.
The House and Senate also passed H.R. 3672, the Disaster Relief Appropriations Act, 2012. That bill spends about $80 per U.S. family on federal disaster aid in the current fiscal year.
Before concluding work for the year, the Senate passed a version of H.R. 3630 that extends the existing payroll-tax holiday and renames the bill from the “Middle Class Tax Relief and Job Creation Act of 2011″ to the “The Temporary Payroll Tax Cut Continuation Act of 2011.”
The Senate-passed version would keep the payroll tax withheld from workers’ pay to fund Social Security at 4.2% instead of the usual 6.2% for two months.
Leaders of the Republican House want to pass a full-year extension of the payroll tax holiday, but because the Democratic Senate has adjourned for the year, its refusal to pass the Senate bill would allow payroll taxes to increase on January 1st. This is the dilemma faced by the House as it debates H.R. 3630 early this week.
The Senate-passed version of H.R. 3630 would save about $360 per U.S. family and increase the national debt by about $26 per family.
The Consolidated Appropriations Act, 2012
Costs $8,802.00 per family
The Disaster Relief Appropriations Act, 2012
Costs $82.80 per family
The Temporary Payroll Tax Cut Continuation Act of 2011
Saves $361.78 per family