The two major components of the plan are the elimination of the federal tax on stock dividend earnings and the immediate implementation -- retroactive to Jan. 1 -- of income tax cuts that had been scheduled to take effect in 2004 and 2006.
"I will ask members of both parties to work with me to secure our economic future. We cannot be satisfied until every part of our economy is healthy and vigorous," Mr. Bush said in a speech to the Economic Club of Chicago.
According to White House figures, the most costly proposal is the elimination of the stock dividend tax. Bush administration officials projected the tax cut would cost $364 billion over 10 years, but claimed it would likely lead to a 10 percent increase in stock values.
The president said the proposal would end an unfair "double" tax of company profits -- once when the company reports its profits and then again when the profits are delivered to shareholders.
"One half of American households own stock, and we have an obligation to make sure American investors are being treated fairly," he said. "Double taxation is bad for our economy. Double taxation is wrong."
As part of the announcement, White House officials released detailed fact sheets that outline tax savings for Americans. According to those figures, 46 million married couples would receive an average tax cut of $1,716 while 23 million small business owners would receive an average $2,042 cut in 2002.
The plan also offers tax breaks for some small businesses. Under the proposal, the amount of equipment purchases business owners can write off as tax deductions jumps from the current $25,000 to $75,000. The plan ties future increases to the rate of inflation.
According to administration figures, the proposal will cost $102 billion in 2003 and the rest of the $674 billion total cost would be spread out over the next decade.
Many Democrats were quick to decry the focus and cost of the president's proposal.
"The president really is investing $600 billion on an old, old Republican theory of trickle-down economics," Rep. George Miller (D-Calif) said. "We're saying no. Give it to the people who need it."
To counter the major presidential initiative, the House Democrats proposed a plan to expand unemployment benefits by 26 weeks and give workers a $300 per person or $600 per working couple refundable income tax rebate. The Democratic plan would also give states $31 billion to help cover the costs of homeland security, highway, Medicaid and unemployment insurance programs.