The United States Senate this week may be voting on an amendment by Senator Mitch McConnell (R-Ky.) to stop the impending 3% tax withholding regime on government contractors.  Because this pending measure is a tax increase, ATR supports Senator McConnell's efforts to repeal it.

Several years ago, a measure was passed which would, in the near future, impose a 3% withholding requirement on all payments to government contractors.  The effective date of this looming event has been continually pushed into the future.  Politicians have used the impending nature of this withholding to shake down government contractors for political contributions.

It is highly inappropriate for politicians to threaten industries with a tax increase merely to extort political contributions from them.  Yet, that is exactly what has happened on the 3% contractor withholding issue.

Senator McConnell's amendment ends this corrupt charade and removes a potential tax increase permanently from the radar screen of employers.

ATR urges all senators to support Senator McConnell's amendment to repeal the 3% contractor withholding rule.