Senate rejects Democratic payroll tax cut proposal

By ALAN FRAM
Associated Press

WASHINGTON (AP) — The Senate has rejected the latest Democratic plan to extend the Social Security payroll tax cut through 2012 thanks to near-solid Republican opposition.

The 50-48 vote fell 10 votes short of the 60 needed. A rival GOP proposal was also doomed to lose.

The vote marks the latest round in the partisan battle over a keystone of President Barack Obama's jobs plan.

The payroll tax is 4.2 percent this year but reverts to its usual 6.2 percent on Jan. 1 without congressional action.

Democrats would cut the tax to 3.1 percent next year and pay for it largely with extra taxes on people earning over $1 million annually.

Republicans would keep the tax at 4.2 percent next year, paying for it mostly with federal workforce cuts. (Copyright 2011 by The Associated Press. All Rights Reserved.)