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December 31, 2012

Deal Reached on Fiscal Cliff

President Obama and Senate Republicans reached a "sweeping deal" that would let income taxes rise significantly for the first time in more than two decades, fulfilling Obama's promise to raise taxes on the rich and averting the worst effects of the fiscal cliff, the Washington Post reports.

While a Senate vote on the package is expected to be held before a midnight deadline, the Republican-controlled House "will begin considering the bill on Tuesday, with a final vote expected in the next day or two."

"The agreement came together after negotiators cleared two final hurdles involving the estate tax and automatic spending cuts set to hit the Pentagon and other federal agencies later this week. Republicans gave ground on the spending cuts, known as the sequester, by agreeing to a two-month delay paid for in part with fresh tax revenue, a condition they had resisted. White House officials yielded to GOP wishes on how to handle estate taxes."

The New York Times notes the "nature of the deal ensured that the running war between the White House and Congressional Republicans on spending and taxes will continue at least until the spring."


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