Congressman Ross addresses extending payroll tax cuts

Last year, the President proposed and Congress passed a one-year payroll tax cut of two percent. Thanks to the cut, workers only had to pay 4.2 percent of their first $106,800 in wages into Social Security, instead of the normal 6.2 percent. For a typical family earning $50,000 a year, this allowed you to keep $1,000 more of your income.


However, that tax cut expires on December 31st unless Congress acts to extend the cut. So, without action, that same family earning $50,000 a year would see their taxes go up by at least $1,000 in 2012. Times are already too tough and a steep tax increase will make times even tougher for families all across the state of Arkansas. Congress must act and extend the payroll tax cut.

Currently, the President has proposed to not only extend the tax cut, but also cut payroll taxes even more - down to 3.1 percent for 2012. Under this proposal, the same family making $50,000 per year would not only see the $1,000 tax cut continue, but they would receive an additional $500 – for a total tax cut of $1,500 in 2012.

I strongly support cutting taxes for working families, because I believe the best way to stimulate this economy is to let working families keep more of their own, hard-earned money. In fact, the nonpartisan Congressional Budget Office estimates payroll tax cuts would generate up to 90 cents on the dollar in economic activity, helping to increase production and create jobs.

It’s also important to note that these payroll tax cuts will not hurt Social Security or its solvency. Retired seniors will continue to receive their Social Security benefits in full and on time. However, because the U.S. will be paying more into Social Security, instead of workers, we must be careful that this payroll tax cut does not add to our already historic budget deficits; they must be paid for.

Both Democrats and Republicans have introduced their own proposals to pay for the payroll tax cut. Democrats and the President have proposed adding a 3.25% tax on those who earn over $1 million a year to pay for tax cuts for the middle class, but that measure has already failed in the U.S. Senate. Republicans have proposed freezing discretionary spending, cutting federal jobs and raising Medicare costs to pay for the payroll tax cut extension, but that measure also failed the Senate. I believe there is room for common ground and I’m hopeful we can find a commonsense solution.

Both sides have got to stop blaming each other and start working together. This issue is too big and too important for working families who are struggling to get by. Raising taxes on middle class, working families by $1,000 next year is completely unacceptable and could stifle any progress we’ve made on our economic recovery.

As a fiscal conservative, I will continue working with both Democrats and Republicans, bringing them together to find a commonsense way we can cut taxes and reduce our deficit. It’s time that Congress focuses on the middle class and starts working for Main Street, not Wall Street. We must extend and expand this payroll tax cut, because it will put more money in your pockets and help get our economy going again.