I am grateful for your service and grateful for the sacrifice of your families. We are all--those of us in positions of responsibility--committed to support you...Our tax laws give the President the authority to issue an executive order granting tax benefits to Americans serving in a combat zone or supporting combat efforts...With our citizens working so hard to protect the people of Kosovo, they shouldn't have to worry about their taxes.

President Bill Clinton
April 12, 1999

Today, President Clinton traveled to Barksdale Air Force Base in Louisiana where he met with military personnel and their families to discuss our mission in Kosovo. The President announced his intention to issue an executive order designating the Kosovo area of operations as a "combat zone" for tax relief benefits.

Providing Special Tax Benefits to U.S. Military Personnel in the Kosovo Combat Zone. Our men and women in uniform on the front lines are working daily in Yugoslavia to prevent further ethnic cleansing and to achieve a durable peace in Kosovo that provides security and self-government for Kosovar Albanians. In recognition of their sacrifice, President Clinton announced he will provide special tax benefits for military personnel in the Kosovo combat zone. The President's plan for special tax benefits for military personnel will cover the aircrews of long-range bombers and naval aircraft flying missions into the combat zone from outside the Kosovo area of operations. This designation will provide several tax benefits to U.S. military personnel serving in the designated area, including the following:

• Their deadline for filing and paying taxes will be extended;

• Their military pay for months served in the combat zone will be exempt from income tax (subject to a dollar limit for commissioned officers), and will not be subject to income tax withholding; and

• Their toll telephone calls originating in the combat zone will be exempt from the telephone excise tax.

Extending Special Tax Benefits to U.S. Military Personnel in Support Operations. The extension of tax deadlines will also apply to U.S. military personnel deployed overseas in support of operations in the combat zone and others such as Red Cross personnel. President Clinton's authority to confer these benefits lies in various provisions of the Internal Revenue Code. Additionally, U.S. military personnel who are serving in the Kosovo area of operations will be eligible for Imminent Danger Pay of $150 per month. Personnel serving in Croatia, Bosnia-Herzegovina and Macedonia are already receiving these benefits under 1996 legislation designating these countries as Qualified Hazardous Duty Areas.

Presidential Leadership for U.S. Forces Working to Save Kosovo. The U.S. tax laws give the President the authority to issue an executive order granting tax benefits to Americans serving in combat zones or supporting combat efforts. Once President Clinton issues the executive order, the Department of Defense, in conjunction with the Commander in Chief U.S. European Command, the military services and the Department of Treasury, will take the necessary steps to implement the order, including the designation of specific units to be covered.