Tax legislation sent to White House


The US Congress has sent bipartisan tax legislation to the White House in a bid avoid a spike in income taxes on January 1

The US Congress has sent bipartisan tax legislation to the White House in a bid avoid a spike in income taxes for millions on January 1 and renew jobless benefits for victims of the worst recession in 80 years.

The measure also will cut Social Security taxes for nearly every wage-earner and pump billions of dollars into the still-sluggish economy.

The 277-148 vote came the day after the Senate cleared the bill, 81-19.

The legislation was the result of a reach across party lines between President Barack Obama and top Republicans in Congress – stubborn adversaries during two years of political combat that ended when the GOP emerged the undisputed winner in midterm elections on November 2.

Republican Ginny Brown-Waite called it “a bipartisan moment of clarity” as the House of Representatives moved towards a vote.

After forcing a delay in the House early in the day, Democratic critics settled for a separate vote in their bid to toughen an estate tax provision they attacked as a giveaway to the very rich. They were defeated, 233-194, with one vote of “present.”

“The president will be able to sign it as soon as he likes,” said Democrat Rob Andrews as the events unfolded in the final days of a tumultuous two-year Congress.

In a statement released shortly after the vote, Treasury Secretary Tim Geithner said the bill was “good for growth, good for jobs, good for working and middle-class families, and good for businesses looking to invest and expand their work force”.

Mr Obama had urged the House of Representatives to approved the measure unchanged, calling the bill a good compromise with Republicans that would help the economy recover from the worst recession in decades. But his pleas failed to satisfy critics in the House who adamantly opposed a provision that would allow 5 million US dollars of each spouse’s estate to pass to heirs without taxation, with the balance subjected to a 35% rate.

Many Democrats favour an alternative to reduce the amount that can be inherited tax free to 3.5 million US dollars, and tax the balance at 45%.

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