Washington, Dec 21 (IANS): Even as the US Congress left for its Christmas holiday without agreement on how to avoid the "fiscal cliff", the White House said President Barack Obama remains "hopeful" that a deal still can be reached.

White House press Secretary Jay Carney said so hours after the Republican leadership pulled their "Plan B" bill, an alternative to avoid the fiscal cliff or automatic tax increases and massive spending cuts that would kick in January 1 without a deal.

"The president's main priority is to ensure that taxes don't go up on 98 percent of Americans and 97 percent of small businesses in just a few short days," he said in a Thursday statement.

"The president will work with Congress to get this done and we are hopeful that we will be able to find a bipartisan solution quickly that protects the middle class and our economy," Carney said.

The statement came as House Speaker John Boehner's so-called Plan B -- which would extend tax cuts that are set to expire at year's end for most people while allowing rates to increase to 1990s levels on income over $1 million -- failed to get enough Republican support.

The Plan B represented a forward movement in the talks on avoiding the fiscal cliff as Republican leaders previously insisted they wouldn't raise rates on anyone, while Obama called tax rates for those earning more than $250,000 threshold to return to 1990s levels while extending tax cuts for everyone else.

"For weeks, the White House said that if I moved on rates, that they would make substantial concessions on spending cuts and entitlement reforms," Boehner said before his plan fell flat. "I did my part. They've done nothing."

The possibility of a fiscal cliff, which economists have warned could push the American economy into a recession again, was set in motion two years ago, as a way to force action on mounting government debt.

Polling has consistently shown most Americans back Obama, who insists wealthy Americans must pay more, rather than Boehner and his Republican colleagues, who have balked at tax rate hikes and demanded spending cuts and entitlement programme reforms.