The House, voting largely along party-lines, approved legislation (H.R. 6169) to set up a fast-track process for overhauling the US tax code in 2013. All Democrats and three Republicans voted against the bill.
The Republican plan that passed, 232-189, would remove some procedural hurdles and set parameters for the tax law. The bill would reduce the top individual and corporate tax rates to 25 percent from 35 percent and eliminate many tax breaks. It would reduce six individual tax brackets to two, abolish the alternative minimum tax and reduce taxes on income earned by US companies outside the United States.
The House also approved, 256-171, a Republican plan (H.R. 8) to extend the 2001 and 2003 tax cuts through 2013 for all taxpayers. During the debate, the House rejected (170-257) a Democratic proposal — identical to a Senate-passed bill (S. 3412) — that would extend the tax cuts for individuals earning up to $200,000 and married couples earning up to $250,000. Tax rates on ordinary income, capital gains and dividends would rise for those earning income greater than $200,000 and $250,000. That vote was mostly along party lines.
A resolution of the expiring tax cuts issue unlikely is to be resolved until after the November elections.
(For more, see: Senate panel approves tax measure)