The Government will also lower the corporate tax rate to about 40 percent, from 46 percent at the moment.

Another change would lower the expected rate of wage inflation to 7 percent from 7.3 percent.

The last reduction came on June 5, when banks lowered the rate from 11 1/2 percent.

He wants to lower the rate to 28 percent from 35 percent for families earning more than $250,000 a year.

Small businesses will see their tax rates lowered from 23 percent to 21 percent.

In the 1920's the top rate was lowered from 73 percent to 25 percent.

Congress last lowered the capital gains tax in 1997, from 28 percent, and the issue has been a flash point between the parties.

The government also lowered a long-term interest rate to 10.25 percent from 11 percent.

It had been lowered from 7.25 percent on Oct. 16.

"So we will lower the bottom rate from 15 percent to 10 percent and double the child tax credit."