A deal to avert a "fiscal cliff" of U.S. tax hikes and spending cuts looked closer on Tuesday after House of Representatives Speaker John Boehner kept the support of his Republican colleagues for compromises in talks with President Barack Obama.
Despite concerns of a revolt by Republicans in the House, Boehner emerged from a meeting with his members unscathed and pledged to press forward on negotiations with the White House. Boehner's concession last week to consider higher tax rates on the wealthiest Americans - an idea long fought by his party - signaled that a deal was possible ahead of a year-end deadline.
Republican Representative Darrell Issa, a key committee chairman, said House Republicans "were supportive of the speaker. ... I saw no one there get up and say, 'I can't support the speaker.'" Boehner is the top Republican in Congress.
Boehner told reporters after meeting his caucus - which includes a core of fiscal conservatives aligned with the Tea Party movement opposed to tax hikes - that Obama's latest offer on taxing the wealthiest Americans is "not there yet," but he remained hopeful of an agreement.
In a major concession to Republican demands, Obama on Monday offered to set a $400,000 threshold for incomes that would face tax increases with the expiration at the end of the year of low tax rates enacted under former President George W. Bush.
Obama had previously insisted on setting the threshold at $250,000. Boehner has been seeking a level of $1 million. Analysts said the two may compromise on $500,000.
Obama and Boehner are working to avert steep tax hikes and deep spending cuts set to begin taking effect next month. Known as the "fiscal cliff," the measures could trigger another recession, economists warn.
As negotiations have largely overcome ideological differences and turned to increasingly narrow disagreements over numbers, markets turned upward on hopes of a deal.
World shares moved toward a three-month high on Tuesday and weakened appetite for safe-haven bonds and the dollar. The benchmark Dow Jones industrial average of 30 major U.S. industrial stocks was up less than 1 percent. The gain followed a steep rally in the previous session.
As both parties tried to digest details of a possible agreement, Boehner put forward what he called "Plan B" legislation. If brought to the House floor, the bill would let Republicans show that they worked to keep income tax rates low on most Americans. For weeks they have feared a public backlash against them if tax rates rise on Jan. 1.