Carter proposes tax-cuts of $27 billion

Press, 30 August 1980, Page 9

Carter proposes tax-cuts of $27 billion

NZPA-Reuter Washington President Carter yesterday proposed personal and business tax-cuts of $27.5 billion in 1981 in a scheme aimed at strengthening the United States economy and boosting his campaign to win a second White House term. His plan, which would increase the tax-cuts to $5B billion by 1985 and create about one million jobs by 1982, also called for increased spending of $2.4 billion on a variety of economic projects next year. These would include industrial development and aid for depressed areas and industries.

Mr Carter unveiled his economic, renewal package

as an alternative to the plan of the Republican presidential candidate, Mr Ronald Reagan, who has called for higher tax-cuts and more reliance on the free enterprise system, Mr Carter, who sharply cut Mr Reagan’s lead in major opinion polls last week, attacked his Republican opponent’s scheme as ill-considered and inflationary. The President’s new plan requires Congressional approval and officials said Mr Carter would submit it to the Senate and the House .of Representatives in January if he defeated Mr Reagan in the November 4 election. For individuals, the main

benefit would come from a cut in income taxes to compensate them for an increase in the social security payroll tax scheduled for January 1.

The White House estimated that the tax-cuts and increased Government spending would raise the estimated $29.8 billion deficit in the 1981 financial year beginning next October by only $6 billion. It said the jump in the deficit would be limited because Mr Carter’s plan would increase economic activity and taxable income, and also because the package would. not . take effect until January, three months after the start of the financial year.