The U.S. House of Representatives has passed a bill that averts the so-called "fiscal cliff," a package of across-the-board tax hikes and spending cuts that congressional budget experts said would have sent the world's largest economy back into recession.
Lawmakers in the GOP-controlled House passed the Senate-approved measure - without amendments - by a vote of 257-167 late Tuesday.
The bill, which President Barack Obama supports, extends decade-old income tax rate cuts for most Americans and postpones for two months automatic cuts in defense and other spending that were established by the Budget Control Act of 2011.
Those automatic cuts were due to start taking effect this week.
"Thanks to the votes of Democrats and Republicans in Congress, I will sign a law that raises taxes on the wealthiest 2 percent of Americans while preventing a middle-class tax hike that could have sent the economy back into recession and obviously had a severe impact on families all across America," Obama said after the House vote.
Although many rank-and-file House Republicans were vehemently opposed to the bill, passed in the Democratic-controlled Senate by an 89-8 vote in the wee hours of Tuesday, Speaker John Boehner and Budget Committee Chairman Paul Ryan - the GOP's 2012 vice presidential candidate - both backed the legislation.
Some high-ranking House GOP leaders, however, opposed the late-hour deal negotiated by Vice President Joe Biden and Senate Majority Leader Mitch McConnell.
Many GOP Republicans were angry over a lack of major cuts to government social programs and called for an amendment to slash $300 billion in spending.
But that change would have required a majority of 217 votes, and Boehner - who had earlier pledged to bring any Senate-passed bill to an up-or-down vote - gauged that it was impossible to reach that number.
In the end, 151 House Republicans opposed the bill and 85 voted in favor. Democrats in the House supported the measure by a margin of 172-16.
Any attempt to amend the Senate bill would have certainly killed the bi-partisan deal due to time constraints, since a new Congress is set to convene on Thursday and the bill would have had to be reintroduced.
The bill raises tax rates on incomes of up to $400,000 for individuals and $450,000 for couples - from 35 percent to 39.6 percent - and will provide the federal government with an estimated $620 billion in revenue over the next 10 years.
Individuals making $250,000 or more annually or couples making $300,000 or more per year will see their itemized deductions capped.
The measure, however, does not extend a payroll tax reduction instituted in 2011 as part of an economic stimulus plan. The expiration of that tax cut means American workers will see their net salaries decrease starting Wednesday.
Unemployment insurance, which benefits an estimated 2 million Americans, will be extended for two years.
By delaying for just two months some $1.2 trillion in automatic, across-the-board cuts to government agencies and programs, the deal virtually guarantees that new fiscal fights between Republicans and Democrats are just around the corner. EFE