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Bush Proposes Financial Incentives for US Small Business - 2003-01-18

President Bush wants Congress to pass a series of economic incentives to help small business owners. Democrats say the president's plan for $670 billion in tax cuts favors the wealthy.

President Bush wants Congress to triple the amount of money small businesses can deduct from federal taxes for investments in new equipment.

By speeding up cuts in income tax, Mr. Bush says, his economic plan would save small business owners an average of more than $2,000. "If tax relief is good enough for Americans three years from now, it is even more necessary today, when our recovery is not as strong as it should be," he said.

Help for small business owners is only about 12 percent of the president's overall plan, but Mr. Bush says it is a big part of fueling broader economic recovery, as small businesses account for nearly half the nation's economic output. "By reducing taxes, encouraging investment and removing obstacles to growth, we will create a platform for future prosperity, so that small business can flourish, and every American who seeks work can find a job," the president said.

Mr. Bush has been focusing more on how his tax cuts help ordinary Americans, as Congressional Democrats attack his plan to eliminate taxes on corporate stock dividends as favoring the rich.

In the Democratic response to the president's radio address, House minority leader California Congresswoman Nancy Pelosi said her party's economic plan would create one million jobs a year and give more help to the unemployed. She said the president's plan for tax cuts is "bloated." "It will not have any real, immediate impact on the economy," she said. "Even the White House's own council of economic advisors estimates that the Bush plan would create only 190,000 jobs in 2003, fewer than one fifth of the one million jobs created by the Democratic plan."

President Bush says Democrats are engaging in what he calls "class warfare" to punish wealthier Americans. He says government can help the economy by putting more money back in the hands of people who do business. "To help small business, government should not try to manage the economy from Washington," he said. "Government's role is to create an environment in which employers succeed and hire new people."

The president said he wants to further streamline business regulations, permanently repeal the estate tax and enact legal reform to curtail what he called "frivolous lawsuits that impose unfair costs on businesses and their customers."