GOP chides Senate for rejecting withholding-tax repeal

The bill, S. 1726, needed 60 votes to pass, which means it failed even though it won 57 ‘yes’ votes on Thursday night.

Senate Republicans jumped on the vote immediately. They argued late Thursday night that because the withholding rule repeal was part of Obama’s jobs proposal, and Democrats have said all portions of Obama’s jobs plan are important, Democrats therefore voted against an important part of Obama’s proposal.

The GOP quoted White House spokesman Jay Carney as saying of the various pieces of Obama’s plan, “they’re all important, they’re all of equal value.” Ten Democrats did end up voting with Senate Republicans in favor of the withholding repeal, but most Democrats voted against it.

Democrats voting against the bill, offered by Senate Minority Leader Mitch McConnell (R-Ky.), were siding with the Obama administration, which said Thursday night that Obama would veto the bill because of how it offset revenue generated by the withholding rule. The administration opposed a rescission of $30 billion in appropriated funds.

“The bill’s unspecified rescission of $30 billion in appropriated funds would cause serious disruption in a range of services supported by the Federal Government,” according to a Statement of Administration Policy. “If S. 1726 is presented to the President with the current offset, his senior advisors would recommend that he veto the bill.”

The Senate vote sets up yet another point of contention between the House and Senate. The House could pass a repeal of the withholding rule as early as next week — the House bill, H.R. 674, is bipartisan and has 269 House co-sponsors.

One key difference between the House and Senate bills, however, is that the House bill does not include the Senate bill’s language on the need to rescind $30 billion in federal spending. It’s unclear whether the absence of that language might allow Democrats and the Obama administration to support it.

Adding to the pressure on this issue is the Chamber of Commerce, which said it would watch how members of Congress vote on the withholding repeal and use that vote as part of its grading of members on business issues.