Remarks to the Mortgage Bankers Association of America

Weekly Compilation of Presidential Documents, March 9, 1998

Anyway, it's against this background that I think you have to see the emerging debate, or, if you will, the continuing debate, on the tax system - what taxes should be cut and how? And the IRS, how should we go about collecting taxes? This is a hazardous discussion that it's easier for me to enter into maybe because I'm not on the ballot anymore - [laughter] - since there's no such thing as a positive thing anyone ever wants to say about this.

But we need to think about it. This debate can be a very healthy thing. We should always be examining, you know, whether there are changes in the tax system we could have which would either be fairer or which would achieve our common objectives more or which would grow the economy faster. And we should always be looking for ways that, through either common sense or new technology, we can ease the burden on our people of paying taxes - always. The door should never be shut to reform, and there will always be more to do no matter what system we adopt. I think all of us know that.

But the point I want to make today is that this debate must occur within the context of our commitment to a long-term economic strategy that will work for our people. It should occur within a context of our commitment to maintain economic confidence in the future. There is a right and a wrong way to do reform. And the right way must involve our continued commitment to fiscal discipline, to investing in our people, and to making the future a predictable and confident one in terms of our economic policy.

Now, within that context, over the last 5 years we've worked hard to reform our tax laws. We've honored our responsibilities as parents with the $500-per-child tax credit. We've rewarded work by more than doubling the earned-income tax credit, which basically is designed to say if you're a parent and you work 40 hours a week, your child ought not to be in poverty. Over 2 million children have been lifted out of poverty because of the changes in the earned income tax credit.

We've recognized the importance and the cost of college education with the HOPE scholarship tax credit, which is worth $1,500 a year for the first 2 years of college, lifetime learning credits for junior and senior years and graduate school, the tax deductibility of student loan interest payments, and other initiatives.

We've encouraged homeownership by eliminating capital gains on almost all home sales. And we've helped Americans save for their retirement, for their education, and health care costs, by expanding IRA's. At the same time, billions of dollars in tax loopholes that were more wasteful have been closed.

This year, the balanced budget proposal I presented to Congress continues to help working families with new tax cuts to make child care more affordable, our economy stronger, and our environment cleaner by meeting the challenge of climate change.

We also had to continue our work to improve the operations of the IRS. Like every American and the majority of IRS employees, who are trying hard to do their jobs well, I get outraged when I hear about abuses in the IRS. But we are making changes, and we must continue to do so. I've already signed into law 40 tax simplification measures and a new Taxpayer Bill of Rights.