ASHINGTON - Texas Governor George W. Bush plans to announce today that he has rejected the idea of a ''flat tax'' and instead will propose a revamped income tax system with a top rate of 33 percent and lower marginal rates for most taxpayers, a campaign aide said last night.
After months of internal campaign debate, Bush will unveil the plan today in Des Moines and hopes to trumpet it tomorrow during his first GOP presidential debate in Manchester, N.H. Some of Bush's opponents have criticized him for not providing details of his tax policy until now.
The key feature of Bush's plan is lowering the current top tax rate of 39.6 percent to 33 percent. In addition, the middle-income tax rate of 28 percent would drop to 25 percent. Surprisingly, the Republican presidential contender does not address whether he wants to reduce capital gains taxes.
Steve Forbes, by contrast, has proposed a flat tax of 17 percent, and Gary Bauer has suggested a 16 percent plan.
While Forbes, who also is seeking the GOP nomination, is likely to criticize Bush's plan for not cutting taxes enough, Democrats are expected to say it puts too much emphasis on helping the wealthiest taxpayers. For example, only 1 percent of the taxpayers would benefit from cutting the top tax rate, according to Robert McIntyre, director of the labor union-backed Citizens for Tax Justice.
McIntyre said the Bush plan ''is a pretty big tax cut for rich people.'' McIntyre's initial analysis shows that the ''top 5 percent of taxpayers would get three-quarters of the benefit.''
But the Bush campaign is focusing on the benefit to lower- and middle-income taxpayers by providing examples of how the plan would affect average families.
''If you earn $1 million, you get a big tax cut,'' another Bush aide said. ''The governor plans to cut taxes for everybody from all walks of life. The governor is not going to start carving people out'' of the tax cuts ''just because they are successful.''
The Bush campaign said that when various deductions are counted, a family of four earning $35,000 a year would get a tax cut of $1,500, and a family earning $50,000 would save $1,900 in taxes.
''My plan sets out to make life better for average men, women, and children,'' Bush will say, according to the draft of today's speech.
According to the Bush campaign, the proposal would cost $483 billion over five years. The Bush plan would also provide a number of increased tax deductions. For example, Bush plans to double the child tax credit to $1,000 and to increase the allowable annual contribution to educational savings accounts to $5,000 from $500. Bush also proposes expanding the use of the education accounts not just for college but also to pay for private elementary and secondary schooling.
