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Bush, heading west, praises tax cuts on Iowa farm

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Bush picks an Iowa farm to plug tax bill's repeal of the estate tax that he says has burdened farm families for years.  


DES MOINES, Iowa (CNN) -- President Bush touted enactment of his prized $1.35 trillion tax relief package late Friday morning on a serene Iowa farm, thankful, he said, for an opportunity to return to the area where he first laid out his plans for a tax cut in December 1999.

"Tax relief is real," Bush, in shirtsleeves, proclaimed to a small crowd of locals gathered on the grounds of the farm just outside Des Moines. "And, tax relief is on the way."

Bush first presented his aspirations for an across-the-board tax cut in the early stages of the 2000 GOP presidential primary cycle. Bush and his Republican opponents spent much of the waning months of 1999 in the Des Moines area preparing for the Iowa caucus that historically opens the campaign season.

It was there the Texas governor revealed he would seek $1.3 trillion in tax cuts over 10 years should he become president. Once elected, Bush's plan grew to $1.6 trillion before Congress whittled the package down to $1.35 trillion, adding an extra year to its span and an immediate stimulus package giving rebates to tax filers before the end of this year.

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CNN's John King reports on the tax cut legislation (June 8)

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Watch the White House ceremony where Bush talks about the cut and signs the bill (June 7)

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  RESOURCES
 
TRANSCRIPTS
• Rep. J.D. Hayworth: What the tax cut means for you
• President Bush speaks on tax cut bill passage
 
  INTERACTIVE
Highlights of Bush's 2002 proposed budget
 
  CNNFYI
What is the new tax-cut law?
A discussion guide for parents, educators
 
  MESSAGE BOARD
Taxing and spending: Bush budget
 

Bush signed the package into law Thursday in the White House as some 200 members of Congress looking on.

Addressing his Iowa audience with a hulking lime-green harvester behind him, Bush touted the tax law's incremental phaseout of the estate tax, which sunsets by 2010 but returns a year later. Congressional Republicans say they hope to draft a series of laws in the "out years" described in the bill, to make its numerous provisions permanent.

The estate tax, referred to by many Republicans and like-minded Democrats as the "death tax," is now applied to estates valued over $600,000. The tax has been harmful, they say, to family farmers and to small business owners.

"I said given the chance to be president I would do everything I could to get rid of the death tax," Bush said. "The bill I signed yesterday recognizes that when you tax a person's assets twice, it is unfair. The bill recognizes the importance of the family farm in America."

Bush said the estate tax has caused "... generation after generation to pay debt, having to borrow money to pay taxes."

He also plugged the bill's provisions for marriage penalty relief and for a gradual increase in the per-child tax credit from $500 to $1,000. The American people, he said, returning to an often-used call, can make better use of the extra money.

"We trust the American people, and all of us in public office should, because the American people are the finest people on the face of the Earth."

Bush flies on to Nebraska on Friday afternoon to throw out the first pitch of the College World Series. He then heads to Texas for a weekend stay on his Crawford ranch.

The new tax law, the first major alteration to the code in 20 years, cuts income tax rates across the board, reducing the lowest rate from 15 percent to 10 percent, and the highest rate from 39.6 percent to 35 percent.

 
Immediate impact

• Up to $300 rebates for single taxpayers, $600 for joint filers mailed this summer -- More on rebates

• $500 child tax credit doubled for 2001 tax year

• Top rate cut from 39.6 to 35 percent, effective July 1

More details from TIME.com

Once all cuts are fully phased in, the average family of four making $50,000 will save $1,825 per year, according to a Senate Finance Committee staff estimate.

The Treasury Department says 38 million families with children will save an average $1,460, 43 million married couples will save an average of $1,728, and 11 million single mothers will save an average of $772, once all cuts are phased in, a process that will take up to 10 years.

One provision of the law -- the cut of the lowest tax rate to 10 percent -- was made retroactive to January 1, 2001, and taxpayers will be sent a rebate to cover that cutback.

Ninety-five million refund checks will start going out in the mail July 20, Michele Davis, Treasury Department spokesman, said Thursday. The checks will be sent to anyone who filed a tax return this year. Singles will get $300, single parents will receive $500 and married couples will see a $600 rebate.

The first week, checks will go to people whose Social Security numbers' last two digits are in the range of 00 to 09, Davis said, and each following week people whose Social Security numbers end in the next 10 numbers will be sent checks.

CNN's Ian Christopher McCaleb contributed to this report.







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