Statement About the Revenue Act of 1971

PRACTICALLY every American--taxpayers, job seekers, housewives, businessmen, workers--will benefit from the historic tax-cut legislation which I have today signed into law. And so will the American economy.

The most important thing this act means is jobs. In addition to the job creating effects of the auto excise tax repeal and of the increase in consumers' after-tax income, the job development credit will create new jobs by encouraging American businesses to buy new equipment--and, by increasing the productivity of our workers, it will help make American business more competitive in the world, and thus keep more jobs here in the United States. Increased productivity will also provide a basis for wage increases not offset by price increases-an increase in our real standard of living.

In its major provisions, this act follows closely the recommendations I made last August. It represents a critical part of the program I announced then to create new jobs and build a new prosperity.

Enactment of this bill means an increase in exemptions for all individual taxpayers and deductions as well for many of them, especially for low--income persons. It means an average saving of $200 for every new car buyer--a fact which has already produced a gratifying upsurge in auto sales, and has thus provided a major stimulus to the economy as a whole. It means that millions of Americans who have demonstrated their own confidence in the economy since August 15 by buying new cars will have a chance to receive that saving in the form of a rebate at Christmastime.

The act also helps meet the special needs of working parents, by providing them with generous new deductions for the cost of child care.

I would have preferred the more stimulative form of the job development credit that I recommended, that is, a 10-percent credit this coming year and 5 percent thereafter. This would have had a greater job-creating impact now when the jobs are most needed. But the credit as enacted will provide a significant boost.

I remain firmly opposed on principle to the tax checkoff device for financing presidential campaigns out of the public treasury which is also included in this act. By postponing the effective date, the Congress has allowed ample opportunity for reconsideration of this measure on its own merits, rather than as part of the tax package. The Senate was right in 1967, when by a bipartisan majority it reversed its earlier decision and rendered inoperative a similar plan that had been enacted in 1966. I have signed this act today because I am confident that, with the time now allowed for reconsideration, this provision-like the earlier one--will not become operative. I strongly urge outright repeal by the Congress of both the 1971 and the 1966 checkoff provisions.