The fight over whether or not to extend payroll tax cuts has been hotly debated by Congress, but a possible compromise may be in order. In order to extend payroll tax cuts, Democrats had looked at a 3.25% increase on incomes over $1 million, which would cover the $200 billion cost of the extension. It would save taxpayers earning $50,000 up to $1,500 a year. Senate Republicans initially blocked the measure.
The possibility of a compromise was signaled when House Speaker John Boehner, R-Ohio, said, “I don’t think there’s any question that the payroll tax relief, in fact, helps the economy.” The gradual shift in stances has raised the debate of how to pay for the extension. White House Press Secretary Jay Carney offered whether “it is worth giving 160 million Americans, taxpayers, a tax break of $1,500 by asking 300,000 Americans to pay a little more.”
