Proponents of the across-the-board reductions in personal income tax rates argue that it will increase incentives to work, save, and invest.  Certain provisions of the proposed tax cut also directly benefit business owners, such as elimination of the estate tax and lower rates for smaller businesses or partnerships. The removal of the estate tax will encourage entrepreneurs and small business owners to make decisions based on economic value instead of tax considerations. It will likewise remove a pernicious form of double taxation.

On the other hand, opponents claim that only the rich will benefit from the tax cut, while reducing the surplus that can be directed towards federal programs such as Social Security and healthcare. The bill also misses out a number of provisions that can benefit the business community, including a cut in the corporate tax rate, accelerated depreciation of equipment, permanent extension of the research and development tax credit, reform of the corporate alternative minimum tax, sweeping changes in U.S. tax haven rules, and an array of smaller items.

But what does it mean to YOU? How are you going to be affected by the tax cut? How much can you expect to get back from the government?

We have found a number of resources to help you understand the implications of President Bush's tax cut for you. (For our non-American visitors, you can check out these resources to learn about the United States' tax system).