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Bush Enacts Fourth Tax Cut

Law Will Benefit Married Couples, Parents and Businesses

By Jim VandeHei
Washington Post Staff Writer
Tuesday, October 5, 2004; Page A08

DES MOINES, Oct. 4 -- President Bush signed into law a fourth tax cut in less than four years, extending relief for married couples, parents and businesses during a well-timed ceremony in this battleground state.

Bush surrounded himself with potential voters who will benefit from his tax cuts to argue that the economy is stronger and families are richer because he fulfilled a pledge made in 2000 to aggressively cut taxes. The cuts "helped our economy overcome a lot of challenges: a stock market decline, a recession, terrorist attacks and war," he said during a bill-signing ceremony at the YMCA here. "And that money will keep the economy moving forward and result in even more new jobs for American workers."


At a rally in Clive, Iowa, President Bush said his challenger would usher in a new era of big government. (Melina Mara -- The Washington Post)



The $146 billion law will keep the $1,000-per-child tax credit intact for five more years and will protect many married couples from paying higher taxes than if they filed as singles. It will extend for six years the 10 percent tax bracket on the first $14,000 in income, which amounts to a $200 break for most taxpayers. While Bush talked mostly about benefits for individual taxpayers, the biggest chunk of the package, about $13 billion, will go to businesses to help fund research and development.

Sen. John F. Kerry supported the tax breaks for individuals but raised concerns about those for businesses. At a rally in nearby Clive, Iowa, Bush warned that Kerry would reverse the economic course set by this White House and slap Americans with a tax increase and usher in a new era of big government if elected president. Kerry has promised to roll back Bush's tax cuts for those making more than $200,000 but to provide additional tax relief to the middle class and businesses.

Bush said the only way Kerry can afford to finance his health care, education and other plans is to tax the middle class. "You may have noticed he changes positions quite frequently -- but not on taxes," Bush said. "During his 20 years in the Senate, he's voted to raise taxes 98 times."

In a new ad called "Thinking Mom," the Bush campaign recycles similar charges about Kerry's tax record while a mother is heard reacting with dismay. "John Kerry and the liberals in Congress have voted to raise gas taxes 10 times," the narrator says. Both charges are technically true but somewhat misleading. Many of the votes were on procedural motions or part of larger budget packages, and Kerry has also voted many times to lower taxes during his Senate career.

In a preview of charges Bush plans to level during the final two debates, he accused Kerry of advocating a nationalized health care system and economic isolationism -- positions Kerry has never embraced during the campaign. Bush said Kerry's health care plan, which would combine tax breaks and new government spending to lower costs and provide coverage to the uninsured, is "creeping towards Hillary-care," a reference to Hillary Clinton's failed health care plan during President Bill Clinton's first term. Kerry has vowed to never replicate that plan.

Bush said Kerry is "hinting about economic isolationism" by promising to review trade agreements to determine whether they include tough enough standards for workers and the environment. "It makes no sense to wall ourselves off from the world," he said. Like Bush, Kerry has portrayed himself as a "free trader" and promised to pursue pacts with foreign nations.

The president again reserved some of his toughest rhetoric for the political fight over war and terrorism. "The policies of my opponent are dangerous for world peace," he charged. "If they were implemented, they would make this world not more peaceful but more dangerous."

Bush changed his schedule for Wednesday and plans to deliver a speech in Wilkes-Barre, Pa., outlining his differences with Kerry on terrorism and the economy.


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