Texas Gov. Rick Perry, a candidate for the Republican nomination for president, has suggested making Congress a part-time legislature. Whatever you think of the idea, Senate Majority Leader Harry Reid of Nevada has already given us something approximating it by sending his members home without a proper payroll tax deal written into law. By passing an unworkable two-month deal as a “take-it-or-leave-it” proposition, then heading home, Reid has acted very much in the tradition of Obamacare, the massive and hastily assembled health care law whose drafting errors will haunt Americans until it is finally repealed. In 2011, American workers enjoyed a 2 percent reduction in their payroll taxes under a deal struck between Congress and President Obama. Congress is trying to extend this lower rate, but the Senate and Obama are insisting on a two-month rather than a 12-month deal. In principle, making the extension effective for a full year is better tax policy because it creates more certainty.
But there are also practical considerations — namely, that this two-month deal simply won’t work. The National Payroll Reporting Consortium (NPRC), a non-profit trade group that represents payroll processors, has informed Congress that this change is much more complicated for businesses to implement than it is for Congress to pass. It isn’t simply a matter of chopping off a few percentage points from each employee’s withholding on pay day.
