Archive for Tuesday, October 5, 2004

Bush extends tax cuts for individuals, businesses

October 5, 2004


— President Bush returned to Iowa, a state he narrowly lost in 2000, to sign into law on Monday an extension of tax relief for families and businesses that he is making central to his re-election campaign.

Democratic candidate John Kerry also supports the middle-class tax cuts that Bush signed Monday -- although Kerry opposed a broader overall tax-cut package the president won his first year in office. Kerry has called it a deficit-worsening measure that tends to mostly benefit the wealthy. He proposes to repeal Bush's tax cuts for the wealthiest Americans.

"The law I signed this morning comes at just the right time for America," said Bush, flanked by two young families. The president said one family that joined him at the ceremony saved $2,800 last year under the tax cuts enacted during his term, enough to buy a new wood-burning stove, make home repairs and vacation in Minnesota.

"Next year when you get your check," the president said, "you may want to come to Texas."

Yet the impact these tax cuts have upon the election remains a major question in a contest that, according to new national polls, is a tie. Longtime observers and practitioners of Iowa politics say many Iowans are more concerned about the economy, war in Iraq and terrorism -- and more concerned about a mounting federal deficit than tax cuts.

"People aren't walking around screaming about the tax burden here," said Dennis Goldford, professor of political science at Drake University. Asked what drives the 2004 election here, he said: "It's the biggies -- the war in Iraq, terrorism, the economy."

Bush campaigned for president here in 2000 with a pledge to reduce taxes across-the-board. He lost Iowa to Democrat Al Gore by just 4,144 votes.

Since election, Bush has won a sweeping series of tax cuts for individuals, families and businesses that will cost the federal government an estimated $1.9 trillion over 10 years. This includes the bill signed Monday, carrying a cost of $131 billion.

The new law extends a $1,000 per-child tax credit for five years, continues relief from a so-called "marriage penalty" in the income tax for four years and keeps a greater number of taxpayers in a 10 percent income-tax bracket for six years. The law also includes many tax breaks for businesses, including support for research and development.

The president says 94 million Americans will benefit.

Kerry supports the package signed Monday, according to his campaign, although the senator from Massachusetts did not vote on the bill because he was campaigning. But Kerry wants to rescind Bush's tax cuts for taxpayers earning more than $200,000 a year to pay for health care for the uninsured and other campaign promises.

Opinion polls taken since the first televised debate between President Bush and Sen. John Kerry last week show the race is tightening.A New York Times/CBS News poll Monday showed each candidate with 47 percent in a poll of 851 registered voters. The margin of error is 3 percentage points.Similarly, a Gallup Poll released Monday found 49 percent of likely voters supporting Bush and 49 percent Kerry. The results of this Oct. 1-3 survey mark a significant shift from Gallup's pre-debate poll where Bush had an 8 percentage point lead. The poll of 722 likely voters has a margin of error of 4 percentage points.Another new poll released Monday by the Pew Research Center found 49 percent of likely voters supporting Bush, 44 Kerry. This also represents a near statistical tie in a survey of 1,003 registered voters taken Oct. 1-3. Pew found that among all voters surveyed Bush had a 48-41 percentage point advantage over Kerry, but that more Democrats expressed a likelihood of voting Nov. 2.

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