- The Washington Times - Saturday, January 18, 2003

WASHINGTON, Jan. 18 (UPI) — President George W. Bush said Saturday the nation's small businesses, responsible for about half the nation's economic output and for creation of millions of jobs, will reap dividends if tax breaks proposed in his 10-year, $674 billion economic growth plan are passed by Congress.

Small business owners in the highest marginal tax rate - estimated to comprise two-thirds of those in that tax bracket - would gain from proposed tax relief since most include their profits when they file their individual returns, he said.

All together, instituting now the tax cuts that were supposed to go into full effect in 2006 under earlier legislation would give 23 million small business owners an average tax cut of $2,042 this year, he said.

"Two years ago, Congress approved income tax reductions that will not go into effect until 2006," the president said in his weekly radio address. "My plan would make these reductions effective immediately to boost the economy in the short term and help insure long-term growth.

He said the change, which would affect all Americans, would enable small business owners to plan for the future, add more employees and invest in the economy.

"To help small business, the government should not try to manage the economy from Washington," he said. "Government's role is to create an environment in which employers succeed and hire new people."

The White House has said middle-income families would receive additional relief from the accelerated reduction of the marriage penalty, the faster increase in the child tax credit, and quicker implementation of the new, lower 10 percent tax bracket.

The plan would also increase from $25,000 to $75,000 the allowed tax deduction for business investment in new machinery and other equipment. That amount after the first year would be adjusted for inflation.

Bush said he was also urging Congress to enact legal reforms to curb frivolous lawsuits that "impose unfair costs on businesses and their customers," and that the government would also streamline business regulations.

"America's economy can thrive only when small businesses thrive," he said. "By reducing taxes, encouraging investment and removing obstacles to growth, we will create a platform for future prosperity, so that small business can flourish, and every American who seeks work can find a job."

The plan, presented in Chicago last week, stirred up a storm of criticism. Democrats on Capitol Hill and many economists said the measure favored higher-income taxpayers and would increase the federal deficit in years to come.

The chorus was joined by some moderate Republicans as well.

One of the most controversial provisions was the proposal to scrap taxes on stock dividends.

The president's plan came amid continuing concern over the economy, which Bush has said is fundamentally sound, but not growing fast enough.





Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.

 

Click to Read More and View Comments

Click to Hide