Roth Outlines Bipartisan Tax Proposal in GOP Radio Address
WASHINGTON -- Senate Finance Committee Chairman William V. Roth, Jr. (R-DE) Saturday will outline his bipartisan tax cut plan which will be before the Senate Finance Committee during the week of July 19. The following is the text of Roth's Republican radio address:
"Good morning. This is Senator Bill Roth, Chairman of the Senate Finance Committee. Earlier this week, our celebration of Independence Day was heightened by the knowledge that we are now in the longest peacetime economic expansion in history. Our nation's unemployment rate is at historic lows. Home ownership is up. Businesses are growing. Families are becoming more secure financially. Congress and the President have balanced the budget. And record surpluses are pouring into the Federal Treasury.
"This is good news. These are wonderful successes. More importantly, they are your successes. Your hard work, your savings, your investment and risk-taking -- they have resulted in the economic growth we enjoy today. And as a consequence, the budget surplus in Washington does not belong to Washington; it belongs to you.
"For this reason, next week I will be proposing legislation to cut taxes for nearly every working American. The cornerstone of my tax relief package will lower the 15% tax bracket that serves as the baseline for all taxpayers. In other words, no matter which tax bracket you happen to be in, by cutting the 15% bracket, you will benefit. For a middle-income family of four this will mean a tax savings of over $450 a year -- in addition to any other credits and deductions for which you may qualify.
"But this tax relief proposal doesn't stop there. It also addresses the marriage tax penalty. For too long, husbands and wives who have worked and paid taxes, have been penalized by their dual incomes. This plan will fix that by providing the fair and necessary tax break these couples deserve.
"It will also eliminate the application of the alternative minimum tax for middle-income families. By doing this, we will eliminate the complexity of the alternative minimum tax and permit families to receive the full benefits from their personal exemptions, their $500 per child tax credits, and the Hope Scholarship tax credit. These benefits were intended to be fully available to middle income families. My tax relief proposal will make that happen.
"The plan will also expand individual retirement accounts, raising the IRA contribution level from $2,000 to $5,000. At the same time, it will increase the amount that 401(k) participants can contribute to their programs by another $5,000 a year. These changes will go a long way towards helping families and individuals save and prepare for retirement.
"To help Americans gain access to health care -- particularly those who are self-employed, or who are not covered by their employers -- this proposal will enhance the tax deductibility of health insurance. And to help make education more affordable for families and students, we will strengthen educational savings accounts and opportunities for employer-provided assistance.
"Each of these measures is vitally important to the well-being of our families; each will be a key component of the tax relief package that will be introduced next week -- tax relief to be shared by nearly all Americans.
"In offering this historic tax relief, we will not fail to meet the challenges to important programs like Medicare and Social Security. Both of these programs are top priorities.
"They are contracts between government and the people, and they will be preserved and strengthened. But the rest of the surplus -- rather than go to create more government in Washington -- needs to go home. It needs to be used by you and your family to meet your needs, and to help you secure your future.
Today our taxes are the highest percent of our Gross National Product than at any other time in post-war history -- and you are paying almost forty cents of every dollar you earn to Federal, state, and local governments.
This is wrong. It undermines the fundamental values that dictate that you -- the individuals and families who worked to create this economic expansion -- should be able to use the surplus to provide for yourself and for your loved ones.
"This is our objective -- to give you the broad-based tax relief you deserve -- to cut taxes, to increase access to health insurance, and to make education more affordable. I can think of no goals that are more important as we look to provide for our families and to prepare America for a bright and prosperous new millennium."
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A two page summary of the highlights of Roth's bill is attached.
Supplement to 106-174 July 9, 1999
Highlights of Chairman Roth's Tax Proposal
(Supplement to the text of the Republican Radio Address)
Senate Finance Committee Chairman William V. Roth, Jr. will unveil his tax "mark" or proposal next week, and will outline highlights of the proposal in the Republican radio address on Saturday, July 10. The legislation, which would cut taxes for millions of Americans, incorporates proposals that have significant bipartisan support and address the biggest financial challenges faced by individuals and families. The Senate Finance Committee will take up the legislation during the week of July 19.
"My tax cut plan, which incorporates proposals that have significant bipartisan support, would cut taxes for millions of Americans and address the biggest financial challenges faced by individuals and families." -- Senate Finance Committee Chairman William V. Roth, Jr. (R-DE)
The following is a brief summary of the major highlights of the legislation.
Roth's proposal includes broad-based tax relief that will cut taxes for millions of taxpayers by:
Cutting the baseline income tax bracket from 15% to 14%. This reduction in the baseline income tax will reduce income taxes across the board for nearly every taxpayer, regardless of income or marriage/family status.
• Taxpayers in the 15% tax bracket, would receive a tax cut of approximately 7%.
• A middle income family of four would receive a tax cut of $450.
• A middle income single person would receive a tax cut of approximately $250.
Eliminating the marriage penalty by allowing married couples to file joint returns as if they were single taxpayers, thus reducing their tax burden.
Getting rid of the AMT for middle income families by ensuring that they will receive the full tax benefits for which they are eligible.
Roth's proposal makes it easier to save for retirement by including proposals from bipartisan retirement savings bills such as:
Increasing the IRA Dollar Limit to $5,000 per year. In addition, this limit will be adjusted annually for cost of living increases, in $100 increments.
Eliminating income limits on IRA and Roth IRA contributions.
Increasing 401(k) and 403(b) contribution limits by 50%; increase 457 and SIMPLE annual contribution limits by a comparable amount.
Creating Roth 401(k) or 403(b) Plan. The bill provides that companies can give participants in 401(k) plans and 403(b) plans the opportunity to contribute to these plans on an after-tax basis, with the earnings on such contributions being tax-free when distributed, like under the Roth IRA.
Allowing people close to retirement age to save more by increasing the amount that those 50 and older can contribute to an IRA, 401(k) plan or 403(b) plan by 50% of the underlying plan contribution limitation.
Making employer retirement plans simpler, more portable, and more accessible to employees.
Roth's proposal would make education more affordable by allowing parents to save tax free in qualified tuition plans.
Roth's proposal would help reduce the cost of child care by enhancing tax benefits for middle income parents through a modification of the dependent care tax credit.
Roth's proposal would extend health insurance to millions of the uninsured by making health insurance fully deductible for everyone not eligible for employer-subsidized health insurance
Roth's proposal would make long term care and taking care of elderly relatives more affordable by:
Making long term care insurance fully deductible for everyone not eligible for employer subsidized long term care insurance
Allowing long term care insurance to be part of an employer cafeteria plan.
Allowing an extra exemption to caretakers of elderly family members.
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