During the October 18th Western Republican Presidential debate Rick Perry challenged Herman Cain’s 9-9-9 plan, stating ” 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 … — I’ll bump plans with you, brother, and we’ll see who has the best idea about how you get this country working again.” Perry followed that up by stating at the Wednesday conference of Western Republicans that he was in fact going to announce a flat tax plan on Tuesday, October 25 th during a speech in South Carolina. He stated “I want to make the tax code so simple that even Timothy Geitner can file his taxes on time,”
It’s been reported by the Wall Street Journal that the flat tax proposal may closely resemble the plan Steve Forbes put forth when he ran for president in 1996 and 2000. Mr. Forbes has recently become an advisor to Rick Perry. In a 2000 campaign brochure, Forbes stated that his plan would include personal exemptions of $13,000 for each adult, $5,000 for each child, and would eliminate taxes on social security, pensions, personal savings and capital gains as well as the death tax. After that, income would be taxed at 17% for everyone.
If Perry’s tax plan gains popularity it may really help him surge ahead. The latest Gallup poll shows Republican Ballot Support of Mitt Romney at 20, Herman Cain at 18 and Rick Perry at 15.
Mitt Romney will certainly be seen as the most traditional candidate, since his plan is to simplify the current tax code, lower the corporate tax rate to 25%, eliminate the death tax, and reduce taxes on savings and investment. Cain and Perry’s plan would scrap the current code and completely overhaul the system.
One of the major issues surrounding Perry’s flat tax will be whether or not it will bring in enough revenue and whether or not it ends up being a regressive tax which will penalize the poor. We’ll know more when the details are revealed on Tuesday.