US News

US Senate unable to pass tax cut extensions

Dec 5, 2010, 10:11 GMT

   Washington - The US Senate on Saturday was unable to pass partial extensions of income tax cuts first adopted in 2001 and 2003.

   On Thursday, the lower House of Representatives voted through a measure that would have permanently extended tax cuts first implemented under former president George W Bush for individuals making less than 200,000 dollars per year and couples earning less than 250,000 dollars per year.

   The House action was considered mostly symbolic because the Senate vote was expected to fail.

   In votes Saturday mostly along party lines, President Barack Obama's Democrats fell short of the 60 votes needed in the 100-member Senate to bring a vote on the House measure and a similar version cutting taxes on incomes below 1 million dollars a year.

   Without action in Congress by the end of December, the Bush tax cuts would expire for all taxpayers.

   Center-right Republicans have demanded that the tax cuts be permanently extended for all income brackets, warning that higher income taxes on even the wealthiest Americans would damage an already weak US economic recovery.

   Meanwhile, the Obama White House and congressional leaders were negotiating on the tax issue with a temporary extension for all incomes expected for at least two years.

   The November 2 congressional elections saw Republicans regain control of the House and trim the Democratic Party's majority in the Senate, but the new lawmakers only take their seats in Congress in January.

   That turnover has left Democrats in the 'lame duck' Congress hoping to pass some of their top legislative priorities in their final month of their control of both chambers. Senate Republicans have vowed to block all legislation until the tax cut feud is resolved.