FROM THE OFFICE OF PUBLIC AFFAIRS

(Revised)

The Department of the Treasury today released new figures demonstrating that because of the President’s tax relief package enacted last May, an additional $50 billion dollars will remain in the hands of American taxpayers through higher refunds and lower tax payments this spring. The total refunds Americans will receive this spring will increase to about $195 billion.

• As a result of the tax cuts in 2003, Treasury expects that a record number of individuals will receive refunds this year.
• Treasury expects that the average refund will be $300 higher than had the Jobs & Growth Tax Relief Act had not been enacted.
• The President’s 2003 tax relief is expected to increase refunds received by Americans by about $37 billion more than if the Jobs & Growth Tax Relief Act had not been enacted, from approximately $158 billion to $195 billion.
• The tax relief is expected to decrease the amount that Americans who must make tax payments when filing their tax returns this spring by approximately $13 billion, from $85 billion to $72.5 billion.
• Taken together the higher tax refunds and lower tax payments are expected to put an additional $50 billion in the hands of American taxpayers this spring.

In addition, Treasury’s data shows that American families will see a significant reduction in their tax burden because of the tax relief packages that the President has signed since taking office. The President’s 2001 and 2003 tax cuts mean that in 2004:

• Americans will receive a total of $232 billion in tax relief in 2004.
• $176 billion in tax relief will stay in the hands of American families and small businesses to help then save and invest.
• Every American who would have paid income taxes before the tax relief was enacted in 2001 will receive a tax cut in 2004.

The President’s Tax Cuts Mean Significant Tax Relief for Working American Families Expanding the 10% bracket and doubling the child tax credit will benefit low income Americans

• Nearly 5 million taxpayers, including 4 million taxpayers with children, will have their income tax liability completely eliminated in 2004.
• Low-income families will also benefit from provisions that make the child credit refundable for more families and reduce marriage penalties caused by the EITC. 111 million individuals and families will receive an average tax cut of $1,586 in 2004 because of the tax cutes of 2001 and 2003.

• 49 million married couples will have an average tax cut of $2,602.
• 43 million families with children will receive an average tax cut of $2,090.
• 14 million elderly individuals will see their taxes fall, on average, by $1,883.
• 25 million small business owners will receive an average tax cut of $3,001.

If Congress Does Not Act, Americans Will Pay Higher Taxes in 2005

If the tax cuts that expire after 2004 are not extended for 2005, taxes will increase for taxpayers who otherwise would benefit from these provisions.

• Lower income taxpayers will not receive $5.7 billion in relief from the expanded 10 percent rate.
• Taxpayers will not receive $8.9 billion in marriage penalty tax relief
• Families with children will not receive $13.2 billion in relief from the child tax credit. In 2005, the increased child credit, additional marriage penalty relief, and expanded 10 percent bracket will sunset, increasing the tax burden on a family of four earning $40,000 by $915.

93 million taxpayers would pay, on average, a tax increase of $565.

• 70 million women would see their taxes increase, on average, by $697
• 46 million married couples would pay, on average, an additional $960 in taxes
• 37 million families with children would incur an average tax increase of $954
• 8 million single women with children would see their taxes increase, on average, by $357
• 11 million elderly taxpayers would pay, on average, an additional $398 in taxes
• 23 million small business owners would incur tax increases averaging $831
• Nearly 2 million individuals and families who currently have no income tax liability would become subject to the income tax.
• President Bush’s budget extends AMT relief through 2005. Without these changes, these taxpayers would pay an additional $23.2 billion in tax as a result of the AMT.