House Approves Jobs and Growth Act

May 23, 2003

Washington, DC – Calling it a bold move to “provide tax relief and job opportunities for all Americans”, Congressman David Dreier (R-San Dimas), Chairman of the House Rules Committee, voted last night in support of the conference report to H.R. 2, the Jobs and Growth Act of 2003, which passed the House by a vote of 231 to 200.

“The economy needs a boost and it needs it now,” Dreier said. ”This package includes components that will alleviate the tax burden felt by all Americans, allowing them to dedicate more of their money for activities such as saving for education, purchasing a home, or planning for retirement. The measure also provides companies with incentives to increase capital spending on new initiatives, creating good jobs for American workers.”

Specifically, the package would:

• Increase the Child Credit, eliminate the Marriage Penalty, and expand the 10% tax bracket through 2004;

• Accelerate the reduction in income tax rates;

• Increase the Alternative Minimum Tax exemption by $4,500 ($9,000 for couples);

• Reduce the tax rate on capital gains and dividends to 5% through 2007 and to 0% in 2008 for the two lowest tax brackets;

• Reduce the tax rate on capital gains and dividends to 15% through 2008 for all other tax brackets;

• Increase Bonus Depreciation for purchased equipment to 50% through 2004;

• Increase Small Business expensing to $100,000 and increases the phase-out threshold to $400,000 through 2005; and

• Provide $20 billion in state-aid.

Dreier noted that the package would immediately help Americans. “Under the plan, 91 million tax payers will receive, on average, a tax cut of $1,126 in 2003,” Dreier said. “In California, 10.6 million people will have lower income tax bills and more than 2.7 million business tax payers can use their savings to invest in new equipment, hire additional workers, and increase pay.”

Dreier lauded the inclusion of capital gains relief in the legislation. “Cutting the capital gains tax is key to sowing the seeds for both short and long term growth, job creation, and continued prosperity, “ Dreier said. “Every time Congress reduced the rate on capital gains, the Treasury realized increased revenues and the economy experienced enhanced growth. There’s a pattern here. Combined with the other provisions of the bill, this plan will benefit Americans and boost the economy.”