Tax Plan Will Lift Economy, Reagan Says

President Reagan said Friday that his tax reform plan would “blast this economy to new heights of achievement” and provide “good news for our silicon cities” by rewarding high-tech risk-takers.

Passing up a planned trip to New York, a state most penalized by his proposal to repeal the deduction for state and local taxes, Reagan flew by helicopter to the Great Valley Corporate Center in Malvern, Pa., a planned business community of 200 high-technology firms near Philadelphia.

“Here in the Route 202 corridor, America is truly on a high-tech highway, rolling full speed ahead --and there ain’t no stoppin’ us now,” he told about 10,000 workers and their families standing in a light rain at the 650-acre center.

The tax plan would lower the capital gains tax from 20% to 17.5% and lower the maximum corporate tax from 46% to 33%.

But, because it also would repeal the 10% investment tax credit frequently used by heavy manufacturing firms, the plan would hurt “smokestack industries” like those in western Pennsylvania.

Reagan said, “High-tech is spreading across the country like wildfire. Silicon Valley (California) is being joined by Silicon Bayou in Louisiana, Silicon Mountain in Colorado and, as some have called it, the Silicon Valley of the East right here in the Route 202 Corridor,” he said.

“Well, we’ve got good news for our silicon cities: We’re going to feed the fires of technological invention by lowering the capital gains tax once again. . . . We’re going to make sure that American technology wins the race to the 21st Century.”

Claiming that the 1981 tax cuts lifted the economy out of “malaise,” Reagan said, “We can build success on top of success. We can ignite the second stage of our booster rockets and blast this economy to new heights of achievement,” he said.

The White House had considered a presidential trip Friday to Upstate New York, but it was scratched on advice of state GOP leaders concerned about popular disapproval of ending the state and local tax deduction. Residents of high tax New York would lose valuable deductions under the Reagan plan.

White House political adviser Edward Rollins said the only result of a trip to New York now would be to get into a debate with Democratic Gov. Mario M. Cuomo, a vocal opponent of that aspect of the proposal.

While he praised Democratic House Ways and Means Committee Chairman Dan Rostenkowski for his initial support, Reagan renewed his attack against Washington lobbyists.

“Do you want a tax system of, by and for the tax lawyers?” he asked. “Or do you want a tax plan that is fairer and simpler, that lowers tax rates for your families and that gives high-tech a boost?”

He said the White House has received “a tidal wave of mail telling us, quite simply, to ‘go for it.’ So keep those cards and letters coming in, folks.”

“Right now, the army of lobbyists and special interests are dug in around the Capitol building, firing every weapon in their arsenal in an attempt to shoot down our proposal for tax fairness and simplification,” he said.