US House Passes Payroll Tax Cut, Links it to Pipeline Plan

Posted December 13th, 2011 at 9:40 pm (UTC-5)
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The U.S. House of Representatives has passed legislation to extend a payroll tax cut that expires at the end of the year, but the extension is tied to a provision that restarts work on a much-disputed U.S.-Canada oil pipeline project.

Despite the threat of a presidential veto of the pipeline provision, lawmakers in the Republican-controlled House Tuesday approved the bill by a margin of 234 to 193. The bill now goes to the Democratic-controlled Senate, where it is expected to fail.

President Barack Obama has called on Congress not to go home for the holidays until legislators extend the payroll tax cut that saved a typical middle class family about $1,000 last year. He has warned of a “massive blow to the economy” if Congress fails to extend the cut, which expires December 31. The president says the wealthiest Americans should pay what he calls “their fair share,” while middle class Americans should not have to pay more taxes during these difficult economic times.

After Tuesday's vote, a White House statement said this Congress needs to do its job and stop the tax increase that is scheduled to affect 160 million Americans in 18 days. The statement said this is a time to help the middle class and all those trying to reach it by extending the tax cut.

Republicans oppose raising taxes for the wealthiest Americans, saying that would hurt economic growth.

The measure passed by the House would require the Obama administration to sign off on the controversial “Keystone XL” pipeline by early next year. President Obama wants to delay a decision on the Canada to Texas pipeline project until after the 2012 elections.

Approval of the project has been delayed to allow for more review of its environmental impact.