The clock is ticking on a current two-percent payroll tax break that is set to expire on December 31.
Republicans and Democrats are still haggling over the extension of the tax cut, which would insure an average American family seeing nearly $1,500 in additional take-home pay. In a recent interview with Greenwood affiliate WLMA, U.S. Senator Lindsey Graham said at issue is how the tax break would be funded. Graham says the present proposal would hurt a Social Security system (which is funded largely by the payroll tax) that is already running out of money.
Instead, Graham said he would like to see a compromise proposal introduced that would give a “targeted tax credit” for wage earners that make $100,000 or less annually.
Graham says he would not want to fund the payroll tax by taking money from the Social Security Trust Fund because millions of seniors depend on Social Security and more people are being added to the rolls each year. He disagreed with the proposal being pushed by Democrats that would include raising taxes on the top wage earners, who he said are the nation’s job creators.
Democrats have proposed expanding the cut to 3.1 percent, and paying for it with a 1.9 percent surtax on income above $1 million.
Saying that the issue is too important to be left undone, President Obama threatened to delay Christmas vacations until the tax cut is passed. Graham says he is confident that a tax cut would be passed, but he adds that lawmakers are often guilty of procrastination.
AUDIO: Graham does not want money taken from the Social Security Trust Fund
Anne Eller of Greenwood affiliate WLMA contributed to the story.