McCain proposes consumer tax cuts to boost economy

By Steve Holland

PITTSBURGH (Reuters) - U.S. Republican presidential hopeful John McCain proposed a summer gas tax reduction and other tax cuts on Tuesday in a bid to reassure voters he would help them navigate an ailing economy.

McCain, the expected Republican nominee for the November election, proposed the steps to boost the struggling U.S. economy, which has surpassed the Iraq war as voters' top concern.

The Democratic candidates quickly denounced the Arizona senator's ideas as a continuation of the economic policies of unpopular Republican President George W. Bush.

"I don't think America can afford four more years of the failed Bush policies, and that's what he's offering," Illinois Sen. Barack Obama told a gathering of construction labor unions in Washington.

Obama and his rival for the Democratic nomination, New York Sen. Hillary Clinton, have accused McCain of being economically illiterate and out of touch with ordinary Americans' pocketbook concerns.

While the Democrats presented plans to boost the economy and help stave off home foreclosures early this year, McCain had not outlined specific ideas until recent weeks.

On the day when U.S. income taxes are due, McCain proposed a simpler tax code and a phase-out of the alternative minimum tax, which has increasingly snared middle-class taxpayers along with the wealthy.

With gasoline prices expected to climb beyond a new high of $3.39 per gallon, he asked Congress to suspend the 18.4 cent federal gas tax and 24.4 cent diesel tax from the Memorial Day holiday at the end of May to Labor Day in early September.