If you thought the war between the parties couldn’t get any worse, wait until you see what December has in store. Democrats and Republicans will be clashing over a government funding bill because the current law expires Dec. 16 and a number of different tax provisions, Politico
Without a funding bill, the government will have to shut down. All bets are off as to how Congress will deal with that one. More than 60 tax-related provisions are set to end after Dec. 31, including the payroll tax cut and extension of unemployment compensation.
Democrats are very eager to extend both of those items. Republicans are open to the extensions but want offsetting spending cuts in return.
“Every action will have a reaction,” Rep. Peter Welch, D-Vt., a leading vote counter for his party, told Politico. “There will be bitter fighting.”
The failure of the supercommittee on budget deficit reduction is responsible for much of the turmoil, as legislators expected the tax-related issues to be included in the panel’s recommendation that was supposed to be made Wednesday.
But now Congress must deal with those issues individually over the next month.
“Everything is going to be super contentious,” Welch said. “The failure [of the supercommittee] to put this in a comprehensive package means that all the ideological divisions about taxing and spending will be fought out on a provision-by-provision basis.”
House Speaker John Boehner says he told President Barack Obama that Republicans are “ready to have an honest and fruitful discussion with him regarding the payroll tax extension, and that invitation stands.”
Congressional leaders have several alternatives for how to deal with the tax provisions. They could be lumped together as part of a continuing resolution to keep the government open. But Republican insiders tell Politico it’s more likely that tax extensions will be combined with spending cuts of an equal amount.
Another possibility is a year-end spending package that would include some of the tax-related provision.
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