President Carter's proposed "economic renewal program" focuses on increasing business investment rather than cutting personal income taxes.

As part of a long-term strategy to fight-inflation, more than half of the $27.6 billion in proposed tax cuts would go to business in 1981. By 1985, two-thirds of $58.3 billion in reductions would be for businesses.

The individual tax cuts proposed, totaling about $12 billion for next year, would offset scheduled increases next year in Social Security taxes, but they fall far short of nullifying the effect of inflation, which pushes individuals into higher tax brackets.

The administration's primary goal is to increase business investment, not consumer spending, as a way to speed an economic recovery beginning next year.

Administration officials said the package of proposals would lead to the creation of 400,000 jobs by the end of next year and of 1 million jobs by the end of 1982. Even so, the unemployment rate would still be slightly above 8 percent late next year, according to administration forecasts.

Most of the major reductions in business taxes -- faster tax write-offs for purchases of new plants and equipment and larger investment tax credits -- are directly linked to investment in productive facilities.

One novel feature of the business tax cuts would be to pay part of the current 10 percent investment tax credit for equipment to companies even if they owe no taxes. This refunding feature would aid newly established companies not yet showing a profit and others with temporary losses.

Carter's total tax cuts, particularly in later years, are much smaller than those proposed by his Republican opponent, Ronald Reagan. But over the next five years, Carter's cuts for business would be greater than those siggested by Reagan.

In fiscal 1985, Carter's proposed cuts in personal taxes would still be less than $20 billion, while Reagan's would top $170 billion.

"We have a limited amount of resources to use," said Stuart Elzenstat, the presidents chief domestic policy aide. "We are taking those dollars and using them for investment, putting them on the supply side, not the demand side."

Further, Eizenstat declared, "We have as many double kicks in this program as we can." One such "double kick" is reducing the Social Security tax burden on business as a way of cutting labor costs and thereby lowering inflation. This change would mean consumer prices would be 0.2 percentage points lower at the end of 1981 than they would be without this program, according to administration estimates.

Carter also offered a series of spending proposals to spur investment in economically depressed areas, help state and local governments whose tax revenues have been reduced by the recession, pay unemployment benefits for a full year instead of 39 weeks, retrain workers, increase energy conservation, repair highways and railroad roadbeds and support more scientific research. Together, the proposals would cost $2.4 billion in fiscal 1981 and $1.9 billion in 1982.

The president also created an Economic Revitalization Board with public, business and labor members who will be named within a few days. The board's task is to recommend how an industrial development authority could be set up to help fund development in parts of the country suffering from high unemployment, and to provide advice on other economic matters.

For individuals, Carter made these specific tax proposals:

An income tax credit equal to 8 percent of what a worker pays in Social Security payroll taxes. If a family has more than one worker, each would get the credit. Federal government employes and state and local government employes who do not participate in Social Securtiy would receive no tax credit. Cost in 1981: $6.4 billion.

Partial relief from the so-called marriage penalty, under which two working spouses pay more income tax than they would pay if they had the same incomes but were single. This widely criticized feature of tax law affected the tax due on nearly 16 million returns filied last year. Much of the penalty would remain, however. For couples whose joint income was $30,000 to $50,000 last year, the average penalty was $860. This would drop to $730 under the proposal, which would allow exclusion for tax purposes of 10 percent of the income of the spouse earning less, to a maximum of $3,000. Cost in 1981: $4.7 billion.

Expansion of the earned income credit from 10 percent to 12 percent of the first $5,000 of earnings, with the credit phased out between $7,000 and $11,000 instead of between $6,000 and $10,000. The credit is available to taxpayers with dependent children, and was designed to offset part of the burden of Social Security taxes for low-income families. Cost in 1981: $900 million.

Exemption from U.S. taxes of the first $25,000 of income earned by Americans living abroad and of 60 percent of the next $60,000, or a maximum exemption of $61,000 for persons earning $85,000 or more. The exemption would be available for places where the State Department authorizes a hardship allowance for U.s. Government employes, which covers all of the Middle East but none of Western Europe. Cost in 1981: $200 million.

For business, Carter proposed the following:

A 40 percent increase in the amount of depreciation in a business can claim for investment in new plants and equipment, along with a major simplification of current procedures for claiming depreciation. In addition, the current 10 percent investment tax credit would apply to equipment lasting more than one year. Only a 5 percent credit now applies to equipment lasting fewer than five years. Cost in 1981: $6.3 billion.

Making the current 10 percent investment tax credit partly refundable. Some businesses are unable to use the credit in the year in which they make an investment because they haven't made enough profit. The proposal would allow any business, even one with no taxes due, to get at least 30 percent of the full credit. This would help new businesses that have not yet turned a profit and firms that are temporarily unprofitable. Cost in 1981: $2.4 billion.

An income tax credit against Social Security payroll taxes for employers, just as for individuals. In the case of businesses that owe no taxes, or state and local governments and nonprofit institutions that do not pay income taxes, the credit would be refundable as cash. State and local governments alone would get about $800 million back next year. Cost in 1981: $6.4 billion.

A new additional 10 percent investment tax credit for investments made in economically depressed areas, with the government giving "certificates of necessity" under which the investments would qualify. This is similar to programs in effect during World War II and the Korean War. Cost in 1981: $200 million.

Allowing the cost of starting or acquiring a business to be written off over five years. These expenses cannot now be deducted until the business is sold or terminated. Cost in 1981: $100 million.

The most sweeping of the business tax changes is in depreciation. By 1985, these proposed tax reductions would cut company taxes by $24.2 billion. A large number of economists and businessmen believe increasing depreciation allowances is one of the best ways to encourage more investment, which in turn can increase productivity and help reduce inflation.

For smaller businesses, simplifying the highly complex system for keeping track of depreciation allowances may be just as important. If the changes are adopted, administration officials said, most firms would have only two depreciation accounts, one for the type of assets all businesses use, such as office equipment, and another for the assets for that type of business.