A House subcommittee has taken a first - albeit largely symbolic - step toward postponing the $3.6 billion increase in Social Security payroll taxes that Congress voted last year to take effect next Jan. 1.
In considering recommendations for the new congressional budget resolution, the panel voted to forgo the January tax hike and instead finance Social Security partly with income taxes.
This proposal, which will be reviewed by the House Ways and Means Committee to Tuesday, is essentially a paper gesture. The pending measure deals with budgetary accounting procedures, and would not actually postpone the hike.
However, the vote does show a growing dissatisfaction in Congress with last December's decision to raise Social Security taxes. The public is protesting strongly.
The subcommittee action came at the suggestion of its chairman, Rep. James Burke (D-Mass.), who is trying to push through legislation that would gradually shift all Social Security financing from the payroll tax to the income tax.
However, the subcommittee rejected a second Burke proposal to cut Social Security taxes by $30 billion as an alternative to President Carter's pending income tax-cut package. Burke would have replaced the $30 billion with money from income taxes.
The increases scheduled for next Jan. 1 would raise the payroll tax rate to 6.13 percent for workers and employers from the present 6.05 percent, and would icrease the amount of a worker's earnings that is subject to payroll taxes to $22,900 from $17,700.