From: Subject: January 24 Date: Fri, 25 Jan 2008 13:51:16 -0500 MIME-Version: 1.0 Content-Type: text/html; charset="Windows-1252" Content-Transfer-Encoding: quoted-printable Content-Location: http://us.gallerywatch.com/pipefile.asp?type=pdf&sid=AGDOC:29131:docs%2Fnews%2FUS%2Fagdocs%2F29141%5FHStimulus%2Ehtm X-MimeOLE: Produced By Microsoft MimeOLE V6.00.2900.3198 January 24

New=20 Growth Package Meets Criteria To Keep Our Economy=20 Healthy

Bush=20 Administration Reaches Bipartisan Agreement With House Speaker Nancy = Pelosi And=20 Republican Leader John Boehner On Measures To Keep Our Fundamentally = Strong=20 Economy Growing

 

Today,=20 President Bush announced his Administration reached a bipartisan = agreement with=20 House leadership on an economic growth package, and he encouraged = Congress to=20 deliver a bill to his desk as soon as possible to bolster the economy = this=20 year.  The President's advisors and many = outside=20 experts expect that our economy will continue to grow over the coming = year, but=20 at a slower rate than we have enjoyed for the past few years =96 and = there is the=20 risk of a downturn.  The agreement reached today meets the criteria = the=20 President set forward last week to provide an effective, robust, and = temporary=20 set of incentives to protect the health of our economy and encourage job = creation.  If enacted in a timely manner, it is expected to help = create=20 more than half a million jobs by the end of 2008.

 

The=20 Growth Package Includes Measures To Bolster Both Business Investment And = Consumer Spending, Which Are Critical To Economic=20 Growth 

 

1.      =20 The agreement = reached=20 today would allow Americans to keep more of their money to stimulate = consumer=20 spending.  The growth plan provides=20 approximately $100 billion in temporary relief that will allow Americans = to keep=20 or spend more of their incomes.  Under the = agreement:

 

=B7        =20 In 2008, taxes = would be=20 cut from 10 percent to zero percent on the first $6,000 dollars of = taxable=20 income for individual taxpayers and the first $12,000 of taxable income = for=20 couples.  Taxpayers could receive = rebates of up=20 to $600 for individuals and $1,200 for couples.  A minimum of $300 = per=20 person and $600 per couple would be available to those with at least = $3,000 of=20 earned income.  This relief would be available = to=20 everyone with adjusted gross income less than $75,000 for singles and = $150,000=20 for married couples filing jointly.  It will be phased out for=20 taxpayers above those income thresholds.

 

=B7        =20 Everyone = eligible for=20 this relief would also receive an additional $300 per=20 child.  For example, this would = mean up to=20 $1,800 of tax relief for an eligible couple with two = children.

 

2.      =20 The agreement = would also=20 offer incentives to spur business investment.  = The = agreement=20 would save businesses approximately $50 billion in near-term taxes = through a=20 temporary change to the tax code that will allow American businesses = that buy=20 new equipment this year to deduct an additional 50 percent of the cost = of their=20 investment in 2008.  = This=20 will encourage businesses to expand and create new jobs now because = buying=20 equipment, software, and tangible property this year will dramatically = lower=20 their taxes.  The agreement also increases expensing for small=20 businesses. 

 

The=20 Agreement Reached Today Adheres To Principles President Bush Set Forward = Last=20 Week To Guide Deliberations

 

The=20 growth package:

 

=D8     =20 Is big enough = to make a=20 difference in an economy as large and dynamic as = ours.  = The package=20 is approximately $150 billion, an amount sufficient to provide a boost = to the=20 economy. 

 

=D8     =20 Is built on = broad-based=20 tax relief that will directly affect economic growth, not Federal = spending that=20 would have little immediate impact on our economy.  = The = package is not=20 a collection of spending programs =96 it does not include any government = outlays=20 beyond the minimum rebate check and refundable child tax=20 credit.

 

=D8     =20 Is temporary = and will=20 take effect right away so we can get help to our economy when it is = needed=20 most.  The personal tax relief will begin = to=20 stimulate consumer spending and additional economic growth within about = 60 days=20 of enactment, when the first rebate checks are expected to go=20 out.

 

=D8     =20 Does not raise = taxes or=20 include wasteful spending provisions.

 

The=20 Growth Package Announced Today Would Use Proven Methods To Keep Our = Economy=20 Healthy

 

The=20 experience of the 2001 and 2003 tax cuts shows that providing tax relief = to=20 families stimulates the broader economy by boosting household = spending. =20 For example, rebate checks = increased total=20 consumption by about 0.8 percent in the quarter that the 2001 rebates = were=20 received and about 0.6 percent in the subsequent quarter.  As the=20 non-partisan Congressional Budget Office noted, "Most analysts agree = that the=20 2001 rebate stimulated the economy."

 

The=20 approximately $100 billion of individual tax relief included in the = growth=20 package represents a substantially larger amount than the tax rebates of = 2001.  In 2001, $38 billion was = distributed in=20 rebate checks, amounting to 0.4 percent of GDP. $100 billion amounts to = 0.7=20 percent of current GDP.