Texas Governor and Republican candidate Rick Perry said Wednesday that he will introduce a new flat tax plan next week. Many believe that a flat tax is simple, fair, and good for the growth of our economy.
Two months ago, Perry was the front-runner. After a terrible showing in several debates and controversies over race and illegal immigration, he has fallen sharply in the polls. Perry is now behind Massachusetts Governor Mitt Romney and the former successful business person Herman Cain.
While Perry has not yet disclosed the details of how his plan will work, he says he wants to ditch,
the three million words of the current tax code and start with something simple: a flat tax.
I want to make the tax code so simple that even Timothy Geithner can file his taxes on time.
Timothy Geithner is the current Secretary of Treasury serving under President Obama who received criticism for not filling his taxes on time.
A flat tax would tax everyone at the same level. Currently, our tax system is a progressive system that taxes people with lower incomes at lower rates and those who make more money at higher rates. Critics of the flat tax rate say that the wealthy will be paying less income tax while the poor will be taking on a larger tax burden.
Perry has criticized Cain for his 9-9-9 plan. Cain’s plan would create a 9% tax for businesses, a 9% tax for personal income taxes, and an added 9% Federal sales tax. This plan has gained some popularity with Republicans because of its simplicity and has helped to move Cain to second in the polls behind Mitt Romney.
Perry criticized Cain in the debate because he would be adding a 9% sales tax. Perry says that the states that do not have a state tax will not appreciate that plan very much, but Cain responds that remark is like comparing apples to oranges.
Romney asked Cain if the state tax was going away and Cain responded, “No, that’s an apple.”
Cain says that his plan will take out five invisible sales taxes and replace them with 9 visible taxes. Visible or not, I’m not sure this plan is as good as it once sounded.
Cain says that none of his distinguished colleagues understand his plan.
Perry to Cain
They’re not interested in 9-9-9. What they’re interested in is flatter and fairer. At the end of the week, I’m going to be laying out a plan that clearly — I’ll bump plans with you, brother, and we’ll see who has the best idea about how you get this country working again.
New details about Cain’s 9-9-9 plan include Opportunity Zones. At some point, a seldom discussed Phase Two would kick in when the 9 % personal and corporate taxes would be done away with leaving the nation with only the national sales tax. Proponents estimate this tax to reach 30 %. Is that an apple or an orange?
Cain and Romney Have Fruit-Fight Over 9-9-9
What are your thoughts about Cain’s 9-9-9 plan?
You may be interested in these articles:
- http://www.mediaite.com/tv/chris-wallace-grills-herman-cain-over-tax-proposals-in-his-999-plan/ (Josh Feldman)
- http://www.washingtonpost.com/blogs/fact-checker/post/herman-cains-misleading-pitch-for-the-999-plan/2011/10/12/gIQAHszPgL_blog.html (Glenn Klesser)