US House Approves Extension of All Bush-Era Tax Cuts

August 2, 2012

The Republican-controlled U.S. House of Representatives has approved legislation that will maintain tax cuts for all Americans regardless of income, setting up an election-year standoff with President Barack Obama and Senate Democrats.

The measure approved Wednesday by a vote of 256-to-171 would extend the breaks passed during tenure of former President George W. Bush. The vote was split largely along party lines, with only 19 Democrats voting for the bill, and one Republican voting against it. Proponents of the Republican measure say it is necessitated because the U.S. economy remains weak.

An alternative plan backed by House Democrats that would extend the tax cuts for everyone, except couples making over $250,000 and individuals making more than $200,000, was rejected. That plan is similar to one passed last week by the Democratic-controlled Senate.

The White House issued a statement after the House vote saying the Republican plan would only help the wealthiest two percent of Americans, which it says would harm investments in critical programs “needed to create jobs and strengthen the economy.”

Lawmakers are facing the prospect of a so-called “fiscal cliff” at the end of the year, when all the Bush-era tax cuts expire and automatic spending cuts for the military and domestic programs take effect, which economists say could push the struggling U.S. economy back into recession.