2% payroll tax cut on track to expire: Per WSJ

The Wall Street Journal reports that both the Republicans and Democrats now appear willing to allow the current temporary payroll tax cut expire at the end of this year. Under the current temporary cut, the employee portion of payroll tax that funds social security is 4.2% and after expiration will revert to 6.2%. Thus, for all American employees, the payroll tax on wages will rise 2% by the end of the year unless the cut is extended.

From the article:

This time, the White House isn't pushing for another extension. "That was always intended to be a temporary measure to support job creation and economic growth," Jason Furman, a top White House economic adviser, said recently. "It's not something that we have at this stage called for extending into next year."

Republicans were unenthusiastic about the tax cut to begin with, preferring instead a broad overhaul of the tax code and contending it would weaken Social Security. Now the party is openly opposed to extending the tax break.

"I'm not for that," said Rep. David Camp (R., Mich.), who heads the House's Ways and Means Committee, which oversees tax policy. "I don't think we can keep cutting into Social Security." House Speaker John Boehner (R., Ohio) has made similar comments.

Therefore, absent changes in political climate before the end of the year to extend the current cuts, wage earners can expect to take home 2% less of their wages starting in 2013 than they are now.