in New Hampshire. “Entrepreneurs whose businesses pay dividend income, or who receive dividend income, will benefit, and long-term it will strengthen businesses that would choose to distribute capital to their investors by means of dividends,” says Blaydon. “The Democratic proposals would put money quickly into the hands of businesses [whose products and services would be retailed to lower incomes because they are more likely to see that money spent at their businesses, but those who are not dealing so much with retail and consumers are less likely to see real, quick benefits. Clearly, lower-income people will get more direct benefits from the Democratic package, but entrepreneurs and small business owners will definitely see benefits from the administration’s proposals if they’re enacted,” says Blaydon.
Bush will surely have to make compromises. The nation’s governors are angry because he has not proposed any aid to the states. Sen. John McCain (R-AZ) and others on the Republican side of the aisle have complained that the president’s plan goes too far.
Bush Plan Highlights
Exclusion of Dividends from Individual Taxable Income
Cost: 2003: $20 billion
2003–2013: $364 billion
Increase in Small Business Expensing for New Investments
Cost: 2003: $2 billion
2003–2013: $16 billion
Accelerated Reduction in Income Tax Rates
Cost: 2003: $29 billion
2003–2013: $64 billion
Democratic Plan Highlights
Extension of Unemployment Benefits
Cost: 2003: $18 billion
2003–2013: $10 billion
Income Tax Rebate
Cost: 2003: $55 billion
2003–2013: $58 billion
Tax Relief for Investment & Job Growth
Cost: 2003: $32 billion
2003–2013: $1 billion
Assistance for States and Localities
Cost: 2003: $31 billion
2003–2013: $31 billion