The House on Tuesday rejected a bipartisan Senate compromise to extend a payroll tax cut for two months, along with unemployment benefits, plunging Washington on the eve of Christmas into uncertainty about the fate of the tax cut enjoyed by 160 million workers.
On a vote of 229 to 193, the House set aside the Senate bill and requested a formal conference with the Senate, setting up a showdown with the Democratic-controlled Senate and President Obama, who has demanded that the House approve the short-term plan now to avoid a Jan. 1 tax hike.
Republicans contend they want to remain on Capitol Hill through the holidays to negotiate a longer-term deal for the rest of 2012. Democrats, who have pushed for the full-year payroll tax cut for months, say Congress should accept the temporary measure now and return in January to solve an impasse over how to extend the cut for the full year.
The Senate deal would also postpone a scheduled cut in reimbursement rates for doctors who treat Medicare patients.
In debate before the procedural votes that shelved the Senate bill, House Minority Leader Nancy Pelosi (D-Calif.) charged that “the extreme tea party element of the Republicans in the House” was blocking an extension of the payroll tax cut and unemployment benefits for millions of Americans.
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