The Republican candidates are tying to one-up each other on taxes. Hermain Cain has his 9-9-9, Ron Paul is going to have a big tax cut and massively cut government spending, and now Rick Perry has a flat tax:
The plan includes a flat income tax rate of 20 percent, but it will also allow any taxpayer the option to remain under the current system, according to a person involved in the Perry campaign. Under current tax law, the wealthiest Americans face a marginal tax rate of 35 percent for much, if not most, of their taxable income
In addition, the plan has a $12,500 deduction for each person in a household, so, for example, two parents with one child would have the first $37,500 of income excluded under the plan.
It will also eliminate estate, capital gains and dividends taxes. This will obviously mean a huge tax cut for the rich, does Perry care?
But I don’t care about that. What I care about is them having the dollars to invest in their companies. To go out and maybe start a business because they got the confidence again because they actually get to keep more of what they work for. If that’s what comes, I’ll take that criticism. Because what I’m interested in is getting Americans working.
And if the rich just take the money and do nothing with it (as they’re doing now)? He’ll be ok with that also, since in each case it means the rich get more.
And what about the deficit? Since this will reduce taxes for everyone, obviously it will make the deficit worse.
I don’t think it does. The budget deficit needs to be addressed through a number of ways. We think this will balance the budget by 2020. And you’ve got to have some hard cuts. You’ve got to deal with the entitlement issue.
This is known as magical thinking. Cutting government revenue by a lot now and talking about cutting costs later will not cause the deficit bigger now–interesting. Ok, Romney, Bachmann what do you have? At some point, I assume one of them will say they’ll eliminate the income tax completely.