Congress extends 69-billion-dollar tax cutting measure (Roundup)

May 12, 2006, 2:34 GMT

Washington - The US Congress on Thursday passed a 69- billion-dollar extension of dividends and capital gains tax cuts, prolonging until 2010 measures championed by US President George W Bush early in his presidency.

'The bill will extend policies that have helped our economy flourish,' Bush said in a statement, promising that he would sign the bill into law.

The Senate approved the bill by 54 to 44, one day after the House of Representatives also passed the legislation, which keeps the tax rate for dividends and most capital gains taxes at 15 per cent.

Most Democrats opposed the extension, which was due to run out in 2008, saying it would add to an already high national debt and primarily benefited the wealthy.

But Treasury Secretary John Snow said the bill 'will avoid a tax increase on millions and millions of American families and keep in place the policies that are so clearly working to promote growth, promote investment and promote jobs,' quoted by Bloomberg News.

The tax-cut extension gives President Bush a much needed victory, amid record-low approval ratings and ahead of hotly contested congressional elections in November.

But the legislation did not include all tax cut extensions requested by Bush. Republican lawmakers said they would introduce tax breaks of another 30 billion dollars in a separate bill later this year.

The 69-billion-dollar bill is the result of negotiations between Senate and House members over which measures to include, after both houses passed different bills five months ago.