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News & Views |Clinton: Social Security Is Top Priority, Not Tax CutsTuesday, January 19, 1999 Deloitte & Touche OnLine President Bill Clinton delivered his State of the Union address late January 19 and urged the nation to use the federal budget surplus to save Social Security before cutting taxes. "Last year, we wisely reserved all of the surplus until we knew what it would take to save Social Security. Again, I say, we should not spend any of it until after Social Security is truly saved. First things first," Clinton told the Congress and other leaders during the State of the Union address. The President also said that a portion of the money set aside to save Social Security should be used to create new 401(k)-type accounts that would enable workers to invest in the stock and bond markets at the direction of an independent board. "With these new accounts, Americans can invest as they choose, and receive funds to match a portion of their savings with extra help for those least able to save," Clinton said. Clinton’s pledge puts him in sharp contrast with House and Senate congressional
leaders who want to use a portion of the surplus to help pay for large tax cuts. Senate
Republicans earlier January 19 unveiled a proposal to cut individual income taxes by 10
percent. |
Details of Tax Proposals Several targeted tax initiatives were outlined in the documents released by the White House prior to the State of the Union address. These initiatives would be paid for by targeted tax increases, which will not be final until the release of the fiscal 2000 budget request February 1. A $5.5 billion long-term health care initiative that would provide a tax credit worth $1,000 will be proposed in the budget, according to the documents. The budget also will include tax incentives aimed at children. Clinton will propose a tax credit enabling parents who stay at home with children under one year old to take advantage of the child and dependent care tax credit. The President also proposes increasing the child and dependent care credit for those earning less than $60,000. Also included is a $700 million tax credit for workers with disabilities and $1 billion
in tax credits worth up to 25 percent of the amount of invested in businesses in
underserved rural and urban areas. |
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