I found an article on SpinSanity which really clarified the debate over Bush's proposed tax cut. SpinSanity doesn't seem to have permalinks so here is an excerpt:

For more clarity, let's turn to one critic who shows us how to square the circle, the Brookings Institution's Peter Orszag. He recently engaged these points in more detail in testimony to the Democratic Policy Committee finding that the top 1 percent of taxpayers by income pay 36.7 percent of income taxes but receive 28.8 percent of the proposed tax cut in 2003 (a finding that is broadly consistent with the Treasury figures). But he points out that this 28.8 percent figure is larger than the group's share of the overall federal tax burden, which is 24.8 percent. This means that the Bush plan would reduce the relative share of federal taxes paid by the top 1 percent even as it increased their share of the income tax burden. The explanation for this is that the tax cut reduces income tax revenues as a percentage of overall federal tax revenues, increasing the proportion of federal taxes coming from taxes that fall more heavily on lower-income Americans, such as excise and payroll taxes.