(Bloomberg News) The U.S. Congress voted to extend a payroll tax cut through 2012, relying on a coalition of Democrats and Republicans in support.
The Senate cleared the $145 billion measure 60-36, minutes after the House passed it 293-132. It goes to President Barack Obama for his signature.
In addition to the two percentage-point tax cut for workers, the agreement will continue expanded unemployment benefits and avoid a cut in doctors' Medicare reimbursements through the end of this year. The provisions would have expired at the end of the month if Congress didn't act.
"As a result of a lot of long hours, hard work and determination on both sides of the Capitol, this agreement shows the American people that Congress can govern and Washington can work," House Ways and Means Chairman Dave Camp, a Michigan Republican, said on the House floor before the vote.
In negotiations led by Camp and Senator Max Baucus, a Montana Democrat, both parties made political sacrifices. Democrats agreed to health-care cuts and a reduction in emergency unemployment benefits while Republicans abandoned their insistence on covering the cost of the full measure.
"Both sides gave a little to get something done," Senate Majority Leader Harry Reid said today.
The arrangement meant that House Speaker John Boehner, an Ohio Republican, had to rely on votes from Democrats to cancel out the no votes cast by some Republicans backed by the Tea Party. Many Democrats said they reluctantly supported the deal.
"We have to vote for this bill because it does a lot of very important things," Representative Frank Pallone, a New Jersey Democrat, said on the floor before the vote. "But I also have to express my reservations."
Democratic concern mostly centered on concern about cutting maximum unemployment benefits, imposing new requirements on federal worker pensions and health-care cuts.
House Minority Whip Steny Hoyer, a Maryland Democrat whose district is home to many federal workers, spoke against the pension provision on the House floor, saying Congress should stop "dissing" federal workers.