The House Tuesday rejected legislation to extend a payroll tax cut and jobless benefits for two months, drawing a swift rebuke from President Barack Obama that Republicans were threatening higher taxes on 160 million workers on Jan. 1.
With neither side showing signs of yielding, a bitterly divided House debated a Republican effort Tuesday to force the Senate to negotiate a payroll tax cut and jobless benefits that expire on New Year's Day.
House Republicans will stick to their insistence that a bill extending a payroll tax cut and jobless benefits include language speeding work on a controversial oil pipeline, Speaker John Boehner said Friday.
Bipartisan agreement is near on a massive $1 trillion-plus year-end spending package and should be reached in time avert a possible government shutdown this weekend, lawmakers said Thursday.
President Barack Obama's Democratic allies in the Senate are using a critical year-end spending bill as political leverage to try to force Republicans to negotiate bipartisan legislation to extend payroll tax cuts and unemployment benefits due to expire at the end of the year.
Democratic officials say a new payroll tax cut plan by Senate Democrats drops President Barack Obama's proposal to award the tax cut to employers in addition to every worker who draws a paycheck.
House GOP leaders are struggling with divisions within their party over whether to extend the payroll tax cut, after the Senate punted on its efforts to keep the tax holiday going another year.
Senate Republicans on Thursday defeated a plan by President Barack Obama to renew a temporary cut in the Social Security payroll tax, even as all sides on Capitol Hill continue to promise an eventual compromise on a tax holiday before Congress leaves Washington for Christmas.
Senate Democrats are advancing President Barack Obama's plan to cut every worker's payroll taxes in half next year paid for by a 3.25 percent tax surcharge on the very wealthy.
The failure of a special deficit-reduction supercommittee sets up a year-end battle between President Barack Obama and a dysfunctional Congress over renewing a payroll tax cut and jobless benefits for millions.