The House of Representatives on Wednesday rejected a bill passed by the Senate that would extend current income tax rates to families earning less than $250,000 per year, and then approved a separate bill extending the rates for all income levels.
Nineteen Democrats joined Republicans in voting against the Senate plan before the Republican bill to extend current rates to all income levels passed 256-171. The second measure had support from 19 Democrats; one Republican opposed it.
The vote sets the stage for a battle over extending the tax rates set during George W. Bush's presidency that will likely be resolved in a lame-duck session after the November elections. If no action is taken, taxes on all income brackets will automatically increase on Jan. 1, 2013.
The White House has vowed that President Barack Obama would veto a bill that extends tax rates on incomes over $250,000.