Reid Intros Softer Payroll Tax Bill To Entice GOP

Senate Democrats introduced Monday a scaled-down version of legislation aimed at extending payroll tax cuts for Americans.

In an effort to entice their Republican counterparts, Democrats have decided to shrink the original $265 billion in payroll tax cuts down to $180 billion by only extending the tax holiday to workers while excluding the break for employers.

“Republicans need to be prepared to meet us partway,” Senate Majority Leader Harry (D-Nev.) said on the Senate floor. “We’re offering a serious proposal with meaningful concessions, including spending cuts to which Republicans have already agreed.”

Republicans will likely raise concerns over what Democrats are calling a concession on their part. Democrats’ original proposal included a permanent 3.25 percent surtax on millionaires’ income as a method to pay for the extension. In their latest proposal, Democrats made the surtax temporary, set to expire after ten years, and have rolled back the original 3.25 percent to 2 percent.

“The scaled-back temporary tax on the richest Americans… is also a sincere attempt to get Republicans on board to pass what they say they want to,” Reid said.

Democrats have also included nearly $40 billion in mandatory spending cuts, that were previously agreed to during supercommittee negotiations, to compensate for the gap left as a result of a reduced levy on millionaires.

An original piece of the Republicans’ proposal made the cut in Reid’s bill that would end food stamps and unemployment benefits for people earning upwards of $1 million.

This story was updated at 3:23p.m. EST…

WASHINGTON - Senate Majority Leader Harry Reid (D-Nev.) is expected to introduce a new plan Monday to extend a payroll-tax cut, an effort that has since failed in the upper chamber twice.

“That was an absolute disaster for the Republicans,” Reid said to the  Carson City Nevada Appeal. 

The failures stem from debate over how to pay for the extension. Democrats introduced legislation that would levy a surtax on millionaires as a means of payment. Republicans countered with a proposal of their own that would have frozen federal employees’ salaries and reduced the federal workforce by 250,000. 

According to reports, Reid’s new plan will reduce the size of the bill and will slash its price tag from $265 billion by more than $80 billion. The new plan will now run $180 billion.

Reid pledged late last week that the upper chamber would extend the tax holiday before it expires at the end of the year. 

“We’re going to get the payroll tax,” Reid said. 

This is a developing story…

The Nevada Demcorat is expected to unveil his new plan on the floor of the Senate at 2:00p.m. EST.