WASHINGTON - The U.S. House approved a plan to give rebates of up to $4,500 to people who turn in older cars for new ones with better gas mileage.

The bill, dubbed "cash for clunkers," was approved on a 298-119 vote Tuesday. It was sponsored by U.S. Rep. Betty Sutton, D-Ohio, along with U.S. Rep. Bruce Braley, D-Iowa, and others.

Braley said the measure will boost the economy, save families money and reduce dependence on foreign oil.

"Cash for clunkers is a common-sense idea that can have a big impact on the economy, reducing emissions and saving American jobs by jumpstarting the auto industry," he said.

The measure would provide a $3,500 voucher for a car that gets at least 22 miles per gallon, as long as it's 4 miles per gallon better than the older car they're trading in.

The voucher would increase to $4,500 if the new car gets 10 miles per gallon greater than the trade-in. New light-duty trucks would have to get 18 miles per gallon for the $3,500 credit, with the improvement in fuel economy at least 2 miles per gallon. The $4,500 credit would apply if the gain in fuel economy is at least 5 miles per gallon.

The bill, while boasting of environmental benefits, is the latest piece of assistance to the auto industry, which has seen sales plummet and General Motors and Chrysler slip into bankruptcy.

Auto repair shops have complained a bill without an option for consumers to get repairs will arbitrarily take cars out of repair shops.

The House plan is expected to cost about $4 billion. The source of funding hasn't been determined yet.

The "cash for clunkers" concept has been discussed for months among lawmakers and the White House. And there's a move afoot to include a separate "cash for clunkers" proposal in a war supplemental bill.

Critics say the bill didn't include incentives for used cars and wouldn't work. "It's defying the laws of economics and saying we can manufacture enough of a demand to keep the auto industry afloat," said U.S. Rep. Jeff Flake, R-Ariz.

The bill now will go to the Senate, where it faces obstacles.

A group of senators led by U.S. Sen. Dianne Feinstein, D-Calif., wants a tougher version that would require greater fuel efficiency in exchange for the vouchers.

Under Feinstein's plan, a car would need to get 24 miles per gallon, with an improvement of 7 miles per gallon to qualify for a $2,500 voucher.

A $3,500 voucher would require a 10-mile-per-gallon improvement, while a $4,500 voucher would require a 13-mile-per-gallon increase in efficiency.

There also would be tougher standards for new trucks, minivans and sport utility vehicles.

(The Associated Press contributed to this article)