WASHINGTON -- Congress gave its final approval Friday to $330 billion in new tax cuts for families, investors and businesses, handing President Bush a victory despite sharply curtailing his plan for lifting the economy from its knees.

The Republican-led Senate approved the measure by 51-50, with Vice President Dick Cheney casting the decisive vote. Two hours after midnight, the GOP-run House had used a 231-200 vote to approve the legislation, which also included $20 billion in aid for cash-hungry states. Bush was poised to sign the bill.

Sen. Saxby Chambliss, R-Ga., who voted in favor of the measure, said Friday the historic agreement between the House and the Senate on President Bush's Jobs and Growth Plan will help create jobs in Georgia and is a good step toward helping the ailing economy.

"Georgia's families will benefit from provisions to speed up income tax rate reductions, increases to the child tax credit, and providing marriage penalty relief," said Chambliss. "Small businesses and farmers will also get help by provisions to dramatically increase the amount they can deduct when buying new equipment."

Rep. Sanford Bishop, the only one of Colquitt County's federal delegation to vote against the bill, was not opposed to the cuts but objected that the plan would be paid for with borrowed money, Bishop's Press Secretary Selby McCash said Friday. Bishop, a member of the fiscally conservative Blue Dog Coalition, thinks this is bad fiscal policy, McCash said.

Under the current revenue situation, all of that $350 billion will be added to the national debt -- predicted to exceed $300 billion at year's end, which would mark an all-time high even without the $350 billion cuts, according to the Associated Press. Bishop believes that a tax cut should be coupled with spending cuts and revenue enhancement, McCash said.

By increasing the national debt, the federal government would push interest rates higher, he said, and those rates are, in effect, a hidden tax that would more than offset any tax cut benefits.

The bill increases the child tax credit from $600 to $1,000, Chambliss' spokespersons said. Enactment will deliver rebate checks of up to $400 per child to many families as early as this summer. Other reductions would go to married couples, most workers, people who sell property, businesses, and corporate stockholders who receive dividends -- though Bush's plan to erase taxes on those dividends was dropped as too expensive.

Though less than half the $726 billion in tax reductions through 2013 Bush initially proposed, approval marked a significant personal victory for the president. Despite polls showing little public interest in tax cuts -- and opposition by some moderate Republicans concerned about burgeoning budget deficits -- the president parlayed his popularity after the victory of Iraq into the third tax cut of his 2-1/2-year-old administration.

It was also a noteworthy win for congressional Republicans, who control Congress by razor-thin majorities but have managed to prevail on a measure they made the cornerstone of their domestic agenda. In the Senate, moderate Republicans John McCain of Arizona, Olympia Snowe of Maine and Lincoln Chafee of Rhode Island opposed the bill, but the GOP prevailed by winning the support of Democratic Sens. Zell Miller of Georgia and Ben Nelson of Nebraska.

"This is a great victory for the American people," said Senate Majority Leader Bill Frist, R-Tenn. "The wonderful thing is it really boils down to greater job security for people."

Democrats said the bill was tilted excessively toward the wealthy, and would make the government's already staggering deficit problem even worse. Even before the tax measure's passage, this year's federal shortfall was expected to rocket well beyond the unprecedented level of $300 billion.

"This is a policy of debt, deficits and decline," said Sen. Kent Conrad, D-N.D., adding, "This is a scandal in the making. We're going to read there are perverse results as a result of this tax policy."

Friday's votes marked the end of a four-month journey for the proposal, which Bush unveiled in January. Before winning passage, the measure sparked wrenching divisions between House and Senate Republicans over how deep the tax cuts should be, and it saw Bush hop campaign-style across the country to put pressure on wavering senators.

Underlining the muscle of moderate senators uncomfortable with the red ink, the bill's tax cuts were less than half the $726 billion in tax reductions through 2013 that Bush proposed in January as a tonic for the swooning economy.

As a result, instead of his trumpeted proposal to end taxes on corporate dividends paid by individuals, a less costly version was included that also reduced levies on capital gains.

Even so, the bill crammed most of the elements Bush proposed into a $330 billion package -- largely by using a budget ruse.

Most of the bill's cuts in personal income taxes would end after 2004 and the dividend and capital gains reductions would end after 2008 -- with levies then reverting to higher levels. Politicians of both parties consider that unlikely to occur because accusations would fly about a tax increase.

Senate Finance Committee Chairman Charles Grassley, R-Iowa, said he will try to make permanent the bill's tax cuts for married couples and its increase in the credit for children.

"I don't believe Congress can go back to the country and say we're going to have the biggest tax increase in history," he told reporters.

The liberal Center on Budget and Policy Priorities estimated that if the tax bill's elements were left intact for the entire decade, its price tag would be at least $800 billion.

The measure would lower the top rates paid on dividends and capital gains to 15 percent -- down from the current highest rates of 38.6 percent on dividends and 20 percent on capital gains. The lowest-earning people would pay 5 percent, and for one year -- 2008 -- would owe no tax on those forms of income.

Of the bill's $350 billion price tag, $210 billion -- or 60 percent -- would occur this year and next. The GOP authors said that would help rev up the economy by flushing money into it.

Almost half the bill's cost was devoted to accelerating income tax reductions enacted in the tax cut of 2001. Workers' paychecks will be fatter after July 1 as companies reduce the amount of tax withheld to reflect reduced income tax rates.

The maximum income tax rate falls from 38.6 percent to 35 percent, and other rates drop from 35 percent to 32 percent, from 30 percent to 28 percent and from 27 percent to 25 percent.

Many married couples will see their standard deduction and their 15 percent tax bracket grow. Parents will be able to claim a $1,000 per child tax credit instead of its current $600, and more taxpayers will avoid paying the alternative minimum tax.

Small businesses can recoup some of their purchases immediately, and expense up to $100,000 until 2005, four times the amount now allowed. Other companies can write off half their investments this year.

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