Don't miss

Replay


LATEST SHOWS

THE DEBATE

Which world order? Trump, Macron spell out rival visions at U.N.

Read more

ENCORE!

Debra Granik: 'There aren't many women who love making films about blood and gore'

Read more

IN THE PRESS

Medical breakthrough? Researchers find way to tackle Alzheimer's

Read more

FOCUS

Jihadists, but no terror attacks: The case of Italy

Read more

THE OBSERVERS

A controversial pastor in Haiti, pollution in Casablanca, and more

Read more

PERSPECTIVE

Photojournalist Reza: 'Children are now the best photographers'

Read more

BUSINESS DAILY

Instagram founders quit photo app

Read more

EYE ON AFRICA

Tanzania investigates ferry disaster which killed at least 227

Read more

MEDIAWATCH

Presidential parody: The unofficial Elysée shop

Read more

Americas

Republicans balk at Senate-approved ‘fiscal cliff’ deal

Video by FRANCE 24

Text by NEWS WIRES

Latest update : 2013-01-01

US lawmakers hoping to resolve the so-called “fiscal cliff'' crisis ran into trouble on Tuesday as the Republican-controlled House of Representatives objected to legislation approved by the Senate earlier in the day.

Washington’s last-minute scramble to step back from a “fiscal cliff” ran into trouble on Tuesday as Republicans in the House of Representatives balked at a deal to avert a budget crisis.

Republican leaders in the House said they might try to change the bill approved by the Senate which voted to raise taxes on the wealthy in a late-night show of unity.

That would set up a high-stakes game of chicken between the two chambers and risk a stinging rebuke from financial markets that are due to open in Asia in six hours.

The bill drew overwhelming support from Republicans and Democrats alike in the Senate when it passed by a vote of 89 to 8. But Majority Leader Eric Cantor, the No. 2 Republican in the House, told reporters after huddling with other Republicans that he does not support the measure.

"A more progressive tax system"

Republicans said they might try to add more spending cuts to the bill, which contains over $600 billion in tax increases but only around $12 billion in spending cuts.

With the Senate adjourned until Thursday, it appeared possible that Congress could push the country over the “fiscal cliff” after all, despite months of effort.

Republicans could face a backlash if they scuttle the deal. Income tax rates technically rose back to 1990s levels for all Americans at midnight, and across-the-board spending cuts on defense and domestic programs are due to kick in on Wednesday.

Economists say the $600 billion combination of tax cuts and spending cuts could push the economy into recession, and public opinion polls show Republicans would shoulder the blame.

Lingering uncertainty over U.S. fiscal policy has unnerved investors and depressed business activity for months.

Financial markets have staved off a steep plunge on the assumption that Washington would ultimately avoid pushing the country off the fiscal cliff into a recession.

With financial markets closed for the New Year’s Day holiday, lawmakers have only Tuesday to close the deal before Wall Street has time to weigh in.

“My district cannot afford to wait a few days and have the stock market go down 300 points tomorrow if we don’t get together and do something,” Representative Steve Cohen, a Democrat from Tennessee, said on the House floor.

The bill passed by the Democratic-led Senate at around 2 a.m. would raise income taxes on families earning more than $450,000 per year and limit the amount of deductions they can take to lower their tax bill.

Low temporary rates that have been in place for less affluent taxpayers for the past decade would be made permanent, along with a range of targeted tax breaks put in place by President Barack Obama in the depths of the 2009 recession.

However, workers would see up to $2,000 more taken out of their paychecks annually as a temporary payroll tax cut was set to expire.

 

(REUTERS)

 

Date created : 2013-01-01

  • USA

    Washington on edge as ‘fiscal cliff’ deadline looms

    Read more

  • US POLITICS

    'Fiscal cliff' showdown heads into final hours

    Read more

  • US POLITICS

    Obama says fiscal cliff deal ‘within sight, but not done’

    Read more

COMMENT(S)