For Immediate Release
Office of the Press Secretary
February 8, 2001
Remarks by the President on Tax Cut Proposal
The Rose Garden
Read President Bush's Agenda for Tax Relief:
text,
pdf
(148 kb)
10:15 A.M. EST
THE PRESIDENT: Thank
you. Please be seated. Thank you very much for
that warm welcome. It's good to see so many friends here in
the Rose Garden. This is our first event in this beautiful
spot, and it's appropriate we talk about policy that will affect
people's lives in a positive way in such a beautiful, beautiful part of
our national -- really, our national park system, my guess is you would
want to call it.
This is the land of economic
miracles, and we are experiencing one here in our
country. Latino businesses are growing faster than the
government can count. Back in 1997, there were 1.4 million
Latino-owned businesses. Since then, the number has been
growing by an estimated 25 percent. No one is entirely sure
of the total. Your success has left all statistics behind,
and America is better off for it.
The businesses you have built prove the
continuing power of the American ideal -- a promise of advancement to
men and women of every background. This country appreciates
you. We appreciate your vision, your hard
work. And I congratulate you for your success.
To succeed, Latino-owned businesses need the
same things all businesses need -- moderate regulation, a sensible
legal system, and a growing economy. For several months,
however, our economic growth has been in doubt. And now, it
may be in danger.
Americans are hearing, and some feeling, the
economic slowdown. Americans hear about the news, many are beginning
to actually feel what it means to be in an economic
slowdown. Consumer confidence has slumped. Many business
leaders are worried. A warning light is flashing on the
dashboard of our economy. And we just can't drive on and
hope for the best; we must act without delay.
My job is to lead. A President
should not wait on events. He must try to shape
them. And the warning signs are clear. All of us
here in Washington, the President and the Congress, are responsible to
confront the danger of an economic slowdown and to blunt its effects.
Today, I am sending to Congress my plan to
provide relief to all income taxpayers, which I believe will help
jump-start the American economy. We must give over-charged
taxpayers some of their own money back. (Applause.) We must
give low-income families fairer treatment. We must give
small businesses a better chance to grow and to hire. For
all these reasons, I urge Congress to help me strengthen our economy,
by lightening the tax load, the tax burden on the American people.
Here's how my tax relief plan will
work. We will simplify our tax code, reducing today's five
brackets to four lower ones: ten percent, 15 percent, 25
percent, and 33 percent. Families with children will also
receive a tax credit of $1,000 per child. We will end the
death tax, reduce the marriage penalty, and expand tax incentives for
charitable giving.
My plan is directed toward individuals and
small businesses. It offers relief for everyone who pays
income taxes, and it keeps our national commitments to Social Security
and debt reduction. These are the details. But it is the
results that will matter most. If we pass this tax relief
plan in a timely manner, three important things will
happen: First, we will return $1,600 to the typical American
family with two children. Working families earning between $35,000 and
$75,000 will keep anywhere from $600 to $3,000 more each year.
With this tax relief, families can save, or
pay off debt, or pay for higher energy bills. This $1,600 is
good for a family, multiplied by millions of families. It is
good for our nation's economy. It means greater demand for
your goods and your services at a time when demand may be
slowing. I'm committed to accelerating economic
growth. Lower interest rates will certainly
help. But they need to be reinforced with tax relief as
well.
There is talk in Congress of bringing this
relief even quicker by making it retroactive to the beginning of this
year. I strongly support that
idea. (Applause.) We
need tax relief now. In fact, we need tax relief
yesterday. And I will work with Congress to provide it.
Our economy faces this
challenge: investors and consumers have too little money,
and the U.S. Treasury is holding too much. The federal
government is simply pulling too much money out of the private economy,
and this is a drag on our growth.
Over the past six years, the federal share of
our GDP has risen from 18 percent to 21 percent -- about as much as our
government took during World War II. President John Kennedy
faced a similar situation in the 1960s. He warned then
against storing up dollars in Washington by taking away more than the
government needed to pay its necessary expenses. High tax
rates, he said -- and I quote -- "are no longer
necessary. They are, in fact, harmful. These high
tax rates do not leave enough money in private hands to keep this
country's economy growing and healthy."
Forty years later, our Treasury is full and
our people are over-charged. Returning some of their money
is right, and it is urgent.
The second effect of my plan is to
substantially reduce the taxpayers that bar too many Americans from the
middle class. Our new 10-percent rate, along with the child
credit, will cut federal marginal tax rates by 40 percent on many
struggling taxpayers.
I've talked about this problem for over a
year, and I'll talk about it until we fix it. Under current
law, say, a waitress is working hard to get ahead, and she may have two
children, earning $25,000 a year faces a higher marginal tax rate than
a successful lawyer earning ten times as much. That is not
right, and that is not fair. The government would take from
her nearly one-half of every extra dollar she earns. Her
hardest hours are taxed at the highest rates.
Today, tax codes are sending -- our tax code
sends this message to this woman: stay where you are, you'll
never get ahead. But that is not the message of America, as
far as I'm concerned. And it must not be the message of our
tax code. Our tax system must reward the dreams of a better
life.
My plan dramatically reduces the marginal rate
on many low-income earners, rewarding overtime or a hard-won raise,
encouraging Americans on their path to the middle class. Six
million families, one out of every five families with children, will no
longer pay federal income taxes at all under our plan.
This country has prospered mightily over the
last 20 years. But a lot of folks feel as if they've been
looking at somebody else's party, that they've been looking from the
outside. It's time to open the door and welcome everyone
in.
And finally, this tax relief plan will be good
not just for the short-term needs of our country, and for our economy,
but for the long-term health of our nation. Every big
business began as a small business. Many of the great
companies of our time were founded when the maximum tax rate on small
businesses was only 28 percent. Today, many small businesses
are paying a tax rate as high as 40 percent. Thousands of
sole proprietors, people with dreams, pay high, high
rates. That's now how one encourages innovation or job
creation, or expansion.
My tax relief plan reduces the marginal rates
that many small businesses pay. We want you to have a
fighting chance in a difficult economy. We also want people
to have more funds to reinvest and to grow their
businesses. We want to make sure that the next generation of
success stories continues far into the future. I hope all of
you will help me in this task. We have minds to change, and
we've got some laws to pass. Our course is
set. And I believe our case is strong.
This week I've been meeting with Americans of
all backgrounds. Young families, leaders of large companies,
entrepreneurs, single moms. All are worried about the
direction of our economy. All are agreed that action is
needed. And today, I'm acting -- for your sake.
I urge the Congress to pass my tax relief plan
with the swiftness these uncertain times demand. I will now
sign a letter of transmittal, and soon hope I'll be signing the needed
tax relief. Thank you for coming. (Applause.)
(The letter is signed.) (Applause.)
END
10:28 A.M. EST
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