Perry proposes 20 percent Flat Tax

[briann]

I think this guy's ship has sailed, but I do like this idea.

http://nationaljournal.com/2012-presidential-campaign/texas-governor-argues-for-replacing-current-tax-code-with-flat-20-percent-rate-20111024

Perry Proposes 20 Percent Flat Tax
AP Photo/Scott Eells, Pool

Perry would keep popular deductions for mortgage interest and charitable gifts.

By Alex Roarty and Rebecca Kaplan
Updated: October 25, 2011 | 10:55 a.m.
October 24, 2011 | 9:30 p.m.

Republican presidential candidate Rick Perry unveiled a sweeping economic agenda Monday, highlighted by a plan to level a voluntary 20 percent "flat tax" on all taxpayers who will accept it in place of what they're paying now.

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The plan, outlined in a Wall Street Journal op-ed column a day before the Texas governor was set to announce it in South Carolina, also calls for capping federal spending at 18 percent of the country's GDP while allowing younger earners to privatize their Social Security accounts -- a controversial proposal that echoes President George W. Bush's failed 2005 attempt to overhaul the retirement program.

But the most significant feature of Perry's plan is his call for a flat tax rate of 20 percent. Taxpayers who don't want to pay a 20 percent flat income tax, he said, can keep their current rate.Current marginal income tax rates range from 10 percent to 35 percent, depending on taxpayers' income.

(RELATED: Perry Launches Ads in Iowa, Hires Top Guns)

Perry offers several proposals that appear designed to sweeten the offer -- and to counter criticism that the flat tax is regressive, taking a proportionally bigger bite from smaller incomes. His plan would preserve popular deductions for mortgage interest and donations to charity for households earning less than $500,000 a year. It would increase the standard deduction to $12,500.

But Perry would eliminate other tax breaks. He argues that a streamed-down tax code (so simple, he says taxpayers can file on a postcard), along with spending cuts and entitlement changes, will stimulate the economy.

"By eliminating the dozens of carveouts that make the current code so incomprehensible, we will renew incentives for entrepreneurial risk-taking and investment that creates jobs, inspires Americans to work hard and forms the foundation of a strong economy," Perry writes.

(POLL: Cain, Romney Lead Wide-Open GOP Field)

Although critics deride it as unfair to lower-income Americans, the "flat tax" has long been a favorite of many fiscal conservatives. Businessman Steve Forbes, who endorsed the governor Monday, made it the hallmark of his presidential campaigns in 1996 and 2000, and it's a favorite idea of many congressional Republicans.

For Perry, the tax overhaul represents an effort to return into the good graces of many conservatives disappointed with a series of stumbling debate performances and apostasies on immigration policy. On Monday, just 10 weeks before the Iowa caucuses, his campaign announced the hire of six new staffers and the start of an ad campaign in the Hawkeye State.

His economic agenda does appear to go farther than some of his rivals. Neither Romney nor former Utah Gov. Jon Huntsman have called for a flat tax (Romney's history with the flat tax is complicated), and Perry's call for a 20 percent corporate tax rate is higher than Atlanta businessman Herman Cain's proposed call for a nine percent rate (although Cain also calls for a nine percent national sales tax.)

Perry's proposed cap on federal spending, 18 percent of GDP, is two points lower than Romney asked for in his own economic plan.

Calling his agenda "Cut, Balance and Grow" -- a clear nod to congressional Republicans, who have proposed a "Cut, Cap and Balance" budget bill -- Perry says his proposal is the best way to cure the nation's ailing economy.

"Cut, Balance and Grow" strikes a major blow against the "Washington-knows-best mindset," Perry said. "It takes money from spendthrift bureaucrats and returns it to families. It puts fewer job-killing regulations on employers and more restrictions on politicians. It gives more freedom to Americans to control their own destiny. And just as importantly, the Cut, Balance and Grow plan paves the way for the job creation, balanced budgets and fiscal responsibility we need to get America working again."

Perry will formally announce his plan Tuesday at a high-tech plastics firm in Gray Court, S.C., outside of Greenville. Later in the day, he will travel to the statehouse in Columbia to announce endorsements from some state legislators.

[Kahane-Was-Right BT]

Sounds like it may be better than the 9-9-9 plan.   

Democrats are already crying about it "it's not fair to middle and lower class, you're giving all this money back to the rich"  but guess what, the rich people drive the economy and by giving the rich more of their own money back, it WILL fuel job growth and overall prosperity along with more investment in business.   It can't be hurting the middle and lower class because anyone can choose the old format if they pay less taxes through that.      And if the govt spends less... far less... it doesn't need to rob so much money from everyone (especially the rich).

[briann]

Sounds like it may be better than the 9-9-9 plan.   

Democrats are already crying about it "it's not fair to middle and lower class, you're giving all this money back to the rich"  but guess what, the rich people drive the economy and by giving the rich more of their own money back, it WILL fuel job growth and overall prosperity along with more investment in business.   It can't be hurting the middle and lower class because anyone can choose the old format if they pay less taxes through that.      And if the govt spends less... far less... it doesn't need to rob so much money from everyone (especially the rich).

Yes, I completely agree with you.  I do think its a more sound plan than the 9-9-9 plan.  But it doesnt sound quite as catchy.  Marketing is important of course.

[TheCoon]

Suggesting this kind of tax plan is useless because it won't pass a democrat congress. The 999 plan has a lot better chance because it is somewhere in the middle.

[Kahane-Was-Right BT]

Suggesting this kind of tax plan is useless because it won't pass a democrat congress. The 999 plan has a lot better chance because it is somewhere in the middle.

How is 999 more in the middle?  I would have thought that perry's is.

[TheCoon]

Perry's is a greater tax reduction for incredibly wealthy, I believe.

[Zelhar]

But does he explain the "cut" part of his plan ? How is he going to cut budget by 25% ?

[briann]

But does he explain the "cut" part of his plan ? How is he going to cut budget by 25% ?

None of the candidates really explain this.  Cutting cost needs to be dealt with to keep us from becoming Greece, but now, it has now become a third rail subject.... which is why we are doomed.

[Daniel Michael ben Avraham]

If the spending is not drastically curtailed then it is all just shooting blanks.  Washington is the problem.

[Rubystars]

I think under a certain income level, that there shouldn't be taxes. Like maybe anyone who makes under 20k a year shouldn't pay income taxes or this flat tax at all.

[Lewinsky Stinks, Dr. Brennan Rocks]

I think under a certain income level, that there shouldn't be taxes. Like maybe anyone who makes under 20k a year shouldn't pay income taxes or this flat tax at all.

I know where you are coming from but I think the opposite, that everyone should pay some tax, because if they did then they would be a lot less keen on voting themselves government handouts.

[Zelhar]

I know where you are coming from but I think the opposite, that everyone should pay some tax, because if they did then they would be a lot less keen on voting themselves government handouts.

Tax shouldn't be imposed for educational purposes. I think Rubystars is more right then you do on this issue.

[Rubystars]

I know where you are coming from but I think the opposite, that everyone should pay some tax, because if they did then they would be a lot less keen on voting themselves government handouts.

A lot of people don't vote anyway, and the less money the government gets, the better in my opinion.

[briann]

I think under a certain income level, that there shouldn't be taxes. Like maybe anyone who makes under 20k a year shouldn't pay income taxes or this flat tax at all.

Thats exactly how flat taxes work in Hong Kong.  Its a little lower than 20K though.

[briann]

Tax shouldn't be imposed for educational purposes. I think Rubystars is more right then you do on this issue.

Then where should the money come from for education?  Or should there be no subsidized education?

[Dr. Dan]

I think there are some good points about a sales tax.  This is for the people who get paid cash and report less of their income. I'll present the Dr. Dan plan

Some sort of flat income tax that should not exceed 35% EVER.  Estate and death taxes should never exceed 20%
Some sort of sales tax that should NEVER exceed 10%.  If a State decides to have a state sales tax, I would recommend that they NEVER exceed 7%.
Corporate tax should never exceed 15%
Every 4 years congress can decide what can be tax deductible and what can't be.  There has to be a minimum of 5 items that can be tax deductible.

By having a tax cap, it forces the government to be unable to get bloated and waste our money.  If they are running out of funds for one program, then guess what? They have to prioritize which program is more important.


It's silly that government is allowed to over tax us.

[Daniel Michael ben Avraham]

I really don't understand the reasoning behind taxing a family after a love one has died.  The person was taxed their entire life and now that they are dead the government sends the IRS thugs to collect???  It seems completely wrong.

[Zelhar]

Then where should the money come from for education?  Or should there be no subsidized education?

You misunderstood me or I miss-expressed myself. I meant to say you shouldn't impose a tax on someone just for the purpose of making him used to paying taxes. I wasn't talking about public education.

[syyuge]

Only a free market economy with Zero Tax is better than Cain 2012...

http://www.hermancain.com/999plan

Herman Cain's 9-9-9 Plan
 
Vision for Economic Renewal

The natural state of our economy is prosperity. Freedom ensures that.
In order to return to prosperity, Government must get off our backs, out of our pockets and out of our way

Economic Guiding Principles

Production drives the economy, not spending. Production is the engine, consumption is the caboose.
We can not spend our way to prosperity.
Government spending is like taking a bucket of water from the deep end of the pool, pouring it in the shallow end. Then they HOPE that the water level will CHANGE.
Risk taking drives growth.
Business formation and job creation are dependent on entrepreneurs taking risks.
Investors who fund those entrepreneurs likewise take risks.
Measurements must be dependable.
A dollar must always be a dollar just as an hour is always 60 minutes.
Sound money is crucial for prosperity.
UNITE, never DIVIDE; UNITED around ECONOMIC GROWTH

When one party is so focused on spending so that the other must focus on cutting, we must unite around economic growth
Unite income tax payers with payroll taxpayers so we all pull for low rates
Unite those wanting to eliminate deductions with those seeking lower rates.
Unite the Flat-Taxers with the Fair-Taxers
Phase One

Our current economic crisis calls for bold action to truly stimulate the economy and Renew America back to its greatness. The 9-9-9 Plan gets Washington D.C. out of the business of picking winners and losers, using the tax code to dole out favors, and dividing the country with class warfare. It is fair, simple, transparent and efficient. It taxes everything once and nothing twice. It taxes the broadest possible base at the lowest possible rates. It is neutral with respect to savings and consumption,capital and labor, imports and exports and whether companies pay dividends or retain earnings.

9% Business Flat Tax

Gross income less all purchases from other U.S. located businesses, all capital investment, and net exports.
Empowerment Zones will offer deductions for the payroll of those employed in the zone
9% Individual Flat Tax.

Gross income less charitable deductions.
Empowerment Zones will offer additional deductions for those living and/or working in the zone.
9% National Sales Tax.

Unlike a state sales tax, which is an add-on tax that increases the price of goods and services, this is a replacement tax. It replaces taxes that are already embedded in selling prices. By replacing higher marginal rates in the production process with lower marginal rates, marginal production costs actually decline, which will lead to prices being the same or lower, not higher.
Economic Impact

According to former Reagan Treasury official Gary Robbins, of Fiscal Associates, the 9-9-9 Plan will expand GDP by $2 trillion, create 6 million new jobs, increase business investment by one third, and increase wages by 10%.
9-9-9 Plan: Summary

Removes all payroll taxes and unites all tax payers
Provides the least incentive to evade taxes and the fewest opportunities to do so
Lifts a $430 billion dead-weight burden on the economy due to compliance, enforcement, collection, etc…
Is fair, simple, efficient, neutral, and transparent
Ends nearly all deductions and special interest favors
Features zero tax on capital gains and repatriated profits
Exports leave our shores without the Business Tax or the Sales Tax embedded in their cost, making them world class competitive. Imports are subject to the same taxation as domestically produced goods, leveling the playing field.
Lowest marginal rates on production
Kills the Death Tax
Allows immediate expensing of business investments
Eliminates double taxation of dividends
Increases capital formation which aids capital availability for small businesses
Increased capital per worker drives productivity and wage growth
Features a platform to launch properly structured Empowerment Zones to renew our inner cities
The pro-growth, pro-job, pro-export economic policies of the 9-9-9 PLAN equals a strong dollar policy
Phase 2 – The Fair Tax

Amidst a backdrop of the economic renewal created by the 9-9-9 Plan, I will begin the process of educating the American people on the benefits of continuing the next step to the Fair Tax.

Ultimately replaces individual and corporate income taxes
Ends the IRS as we know it and repeals the 16th Amendment
Meet Herman Cain

Mr. Cain has more than 40 years experience in the the private sector where he balanced budgets, created jobs and rescued failing companies. A no-nonsense business leader who has turned struggling companies around to renewed success, Mr. Cain’s policies will do the same for the United States of America.

Find out more at www.HermanCain.com/about

[briann]

I really don't understand the reasoning behind taxing a family after a love one has died.  The person was taxed their entire life and now that they are dead the government sends the IRS thugs to collect???  It seems completely wrong.

There is no reasoning...other than, hey, here's a way to get more money from our taxpayers.

They would tax breathing if they could.

[Kahane-Was-Right BT]

Perry's is a greater tax reduction for incredibly wealthy, I believe.

I think you should read my comment.

[HiWarp]

There is no reasoning...other than, hey, here's a way to get more money from our taxpayers.

They would tax breathing if they could.

You betcha. I can hardly wait to see what scheme they eventually come up with to tax the sun when everyone goes solar like the politicians say they want us to do.

[syyuge]

What a dread, taxing of the dead, breathing air and sun.