NEWS RELEASE

Posted: May 16, 2003

CARPER: TAX CUT IS THE WRONG WAY

WASHINGTON - Sen. Tom Carper issued the following statement about the $350 billion tax cut plan approved Thursday by the Senate along a mostly party-line vote.  

"The Republican tax cut plan would take the country in the wrong direction by increasing deficits and adding to the debt burden of America's future generations," said Carper.  "The Congressional Budget Office earlier this week said the nation's deficit would reach nearly $300 billion this year, the largest ever on record.  Some forecasters have said it could go as high as $400 billion. 

"This tax cut, regrettably, will only make the deficit go up even more.  Included in the bill is an elimination of the estate tax, but in order to mask the provision's true cost, the dividend tax is restored in 2007.  It's the same accounting trick that was used in the tax bill of 2001, when Congress voted to eliminate the estate tax but didn't make it permanent.  This kind of smoke and mirrors hurts our long-term fiscal health and it's not good for business, which needs certainty in the tax code to make their long-term investment decisions. 

"It's irresponsible to consider passing such a large tax cut at a time when our country's deficits are at an all-time high.  Indeed, next week, the Senate plans to vote for nearly a $1 trillion increase in the nation's borrowing authority without having a plan in place to bring down our deficits and restore a balanced budget. 

"Instead of passing tax cuts that would likely have little positive effect on the economy - and are designed to disproportionately benefit only a small number of Americans -- we should instead be looking for ways to reduce our debt and restore fiscal sanity."

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