March 17 (Bloomberg) -- The U.S. Congress gave final approval to an $18 billion jobs bill offering companies a tax break for hiring the unemployed in lawmakers’ first effort this year to boost the economy before the November elections. The Senate voted today 68-29 to send the legislation to President Barack Obama for his signature. It would also expand federal subsidies for municipal bonds, increase highway spending and offer small businesses more power to write off the cost of investments.
“This is a good day for American workers,” said Senator Charles Schumer, a New York Democrat. “This is just the first, certainly not the last piece of legislation that we will put forward in relation to jobs.”
Republicans criticized the legislation, saying the $13 billion payroll tax holiday, estimated to produce up to 234,000 jobs, would cost taxpayers too much per position created. Others criticized the bond subsidies as excessive. “This isn’t so much a jobs bill as it is a debt bill,” said Senator Judd Gregg, the ranking Republican on the Budget Committee.
The measure would offer companies a holiday this year from a 6.2 percent Social Security payroll tax for each worker they hire who has been unemployed for at least 60 days. It would transfer almost $20 billion in tax revenue into the government’s highway trust fund while expanding subsidies for bonds financing school construction and energy related projects.
The House approved the bill earlier this month. The Senate passed a second measure last week costing $138 billion that would extend unemployment benefits through the rest of this year while providing an additional $25 billion to states to help balance their budgets. Economists have said the legislation would only have a modest impact on employment.
