Perhaps piggybacking on the enormous popularity of Herman Cain, now synonymous with the numbers 9-9-9, Rick Perry has taken a similarly bold stance on the tax code, proposing a flat tax of his own. Perhaps what Perry did not notice, however, was the massive backlash Cain’s plan suffered, which later led to a recantation of parts of 9-9-9, allowing for tax credits and exemptions.
Perry might avoid the firestorm of criticism that Cain’s plan has faced (that is, charges that it raises taxes significantly on the lower and middle classes) by allowing for exemptions at the outset. Perry’s flat tax allows for a $12,500 deduction per individual, and has also given taxpayers the option of filing under the current tax code or his proposed flat tax. These small measures appear to have been made in direct response to the outcries over the nature of flat taxes which inherently raise taxes on the working class. These concessions may quiet some concerns, but flat taxes are hardly feasible in America.
Rick Perry still hasn’t accounted for the criticism that a flat tax is an enormous tax break for the wealthy in a nation that overwhelmingly supports raising taxes on the rich. Our progressive tax system is structured to generate more revenue from those who can afford to pay the most, while a flat tax is in direct contradiction to this principle. Many middle class Americans will pay roughly the same amount in taxes regardless of which system they choose to file under, the poor will undoubtedly pay more under Perry’s plan, and the rich will enjoy a substantial payday. Moreover, Perry fails to account for how this revenue stream will be accounted for. Income from taxes paid by the top 1 percent of taxpayers account for nearly 40 percent of taxes collected. It’s difficult to see how this plan is beneficial to taxpayers except for a small minority of the upper classes.
Moreover, there is one glaring, contradictory problem with Perry’s suggestion that his tax plan will lead to simplicity: Assuming most taxpayers would like to minimize their taxes paid, they would each need to calculate the amount they would owe under both tax systems. Who, exactly, does that lead to simplicity for? The only ones who would clearly benefit from a flat tax, and would thus not need to bother with forms Perry describes as being lengthier than “War and Peace,” would be the rich who clearly benefit from the plan.
For many taxpayers, the simplicity of filing taxes on a form as small as a postcard is rendered moot by being given the option of filing under the new system, what Perry surely envisioned to be the saving grace of his tax proposal. They’ll have to determine whether they’re saving money by calculating their taxes owed under both systems, which doesn’t seem to be something considered by Perry and staff while devising this plan. In an attempt at simplicity, Rick Perry has made no apparent attempt to reform the current tax code: his proposal simply adds another layer to the existing system.
Brief plans are easier to remember, but they can easily skimp on details, which appears to be the case with Perry’s initiative. “Simple” and “good” are not synonymous.