The U.S. House passed a bill Thursday to permanently extend the Bush-era tax cuts for individuals earning less than $200,000 and married couples earning less than $250,000 annually, but Republicans have vowed to keep any tax extension measure off the president’s desk that does not include tax cuts for all income brackets.
A small bloc of 20 Democrats broke ranks with their party and voted against the measure, which passed 234-188. Three Republicans voted to pass the bill.
Senate Majority Leader Harry Reid suggested before the vote Thursday afternoon that he would follow the lead from the House bill and put it to a vote in the Senate, but would wait on the bill’s passage to make a final decision.
“We’ll wait and see,” he said when asked about the Senate’s next move on tax cuts. “I may have to have another caucus today or in the morning to find out how we react to what the House does.”
House Democrats defended the move as a compromise bill based on an idea that both sides could agree on — that taxes shouldn’t be raised on the middle class — but Republicans blasted it as a publicity stunt. The bill contained rules that blocked Republicans from offering alternative proposals or offering changes that would give the House a chance to vote to extend the tax cuts to all income earners. Speaker-designate Rep. John Boehner even described it as “chicken crap.”
“Clearly this bill is going nowhere,” said Michigan Republican Rep. Dave Camp, adding that it will “never see the light of day in the Senate.”
Senate Republicans announced yesterday that they would block any legislation that Democrats try to bring to the floor until the tax cuts are extended for all wage earners and Congress votes to fund the government into the next year.
President Obama met with Republican leadership Tuesday to discuss the looming tax hike, and called for a bipartisan agreement on the issue this week. The negotiations, led by Treasury Secretary Timothy Geithner for the Democrats and Arizona Sen. John Kyl for the Republicans, are expected to yield a compromise agreement. Republicans hope to get a temporary extension of all the cuts, and in return, Democrats could receive a deal to extend unemployment benefits that expire this week and approval for a renewal of a nuclear arms treaty with Russia.
If no deal is reached by the end of the year, taxes will increase for all income earners on the first of the year.