Bush Administration Renews Call For Tax Cuts

by Leroy Baker, Tax-News.com, New York

19 April 2006

The Bush administration has once again called upon Congress to swiftly pass legislation extending tax cuts which, according to the White House and the Treasury Department, are essential to prolong America's economic well-being.

Speaking at a roundtable on taxes and the economy at Europa Stone Distributors in Virginia on Monday, President Bush once again argued that the temporary tax relief passed during his presidency and America's economic recovery are inextricably linked.

According to Mr Bush, tax cuts have helped small businesses create 5.1 million jobs in the last two-and-a-half years.

"And what's interesting is the tax relief is set to expire," observed Mr Bush.

"Actually, there's some Democrats in Congress who would like to raise taxes now. And if that happens, it will be a tax increase no one expects, no one wants," he added.

House and Senate lawmakers were unable to agree the provisions of a tax reconciliation bill before the Easter Congressional recess. The Bush administration wants the final version of the bill to extend capital gains and dividend tax cuts for two more years until the end of 2010. It is also hoped that a one year 'patch' to the Alternative Minimum Tax will form part of the final bill.

"I strongly urge the United States Congress to understand the positive effects of the tax relief and to keep the taxes low," Mr Bush stated.

Meanwhile, Treasury Secretary John Snow used the opportunity presented by Monday's tax filing deadline to press his argument for tax relief.

According to Mr Snow, 25 million small business owners will save an average of $3,600 this year thanks to the recent tax cuts. He also claimed that 44 million families with children will receive an average tax cut of nearly $2,500, while 14 million elderly individuals will receive an average of $2,000.

"The benefits of lower taxes are not just felt on Tax Day. They are felt every day, in the outstanding growth of the American economy," stated Mr Snow.

"I commended Congress for making real progress before they left for break on a package to extend the President's tax relief for capital gains and dividends for two years and providing AMT relief, and I strongly urge them to complete work on this package as soon as possible when they return from recess," he concluded.

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