Senate OKs $70 billion tax cut bill

The Senate gave final approval Thursday to a $70 billion election-year package of tax cuts that will extend lower rates for investors and also save billions for families with above-average incomes.

Republicans promised the bill will produce economic gains for the nation ? and hoped it would give a much-needed boost to President Bush and the GOP-controlled Congress as they both experience their lowest approval ratings in polls since his election in 2000.

The bill passed the Senate by a 54-44 vote, and Bush is expected to sign it next week.

The legislation provides a two-year extension of the reduced 15 percent tax rate for capital gains and dividends, currently set to expire at the end of 2008.

It also will extend for one year recent changes to the alternative minimum tax to prevent it from hitting more upper middle-income families.

The AMT was designed to hit the very wealthy, but it is now common for taxpayers, especially those with families in high-tax states, to pay the AMT on incomes of $100,000 and more.