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Democrats Drop Proposal to Tax Wealthy
With time running out before the expiration of the payroll tax cuts, Democrats are dropping their proposal to tax the wealthiest Americans to pay for the relief as a way to compromise with their Republican counterparts. The legislation to extend the cuts passed the House earlier this week, but not without contention or the remaining partisan dispute over how to pay for them. However, it appears the Democrats have blinked first.
Democrats backed away from their demand for higher taxes on millionaires as part of legislation to extend Social Security tax cuts for most Americans on Wednesday as Congress struggled to clear critical year-end bills without triggering a partial government shutdown.
Officials said Democrats were drafting a new proposal to extend the payroll tax that likely would not include the millionaires’ surtax that Republicans opposed almost unanimously.
But Senate Minority Leader Mitch McConnell, R-Ky., has minimized the significance of the compromise and suggested in an interview with CNBC that Democrats are “not giving up a whole lot” in the deal.
Asked about the party caving on the surtax, U.S. Rep. John Yarmuth, D-Ky., issued the following statement:
“I don’t think the idea that the wealthy need to pay their fair share is going away–the majority of Americans support it. Republicans are committed to protecting billionaires even if they have to raise taxes on the middle class to do it,” he says.