PRESIDENTIAL CANDIDATES PUSH DRAMATIC TAX PLANS. The latest GOP presidential debate scheduled for Tuesday night is expected to focus heavily on the economy and nearly every Republican platform for 2016 includes some form of dramatic tax reform, Richard Rubin of the Wall Street Journal reports
Driven by a desire to stand out in a crowded field and spark economic growth, the GOP contenders no longer just say they want to lower rates and expand the tax base. Their new ideas, once the province of right-leaning think tanks, make previous Republican plans look timid.
Nearly all the GOP candidates—who will meet again Tuesday evening in a debate hosted by Fox Business Network and The Wall Street Journal—are promoting at least one tax idea the party hasn’t tried to sell to a general-election audience.
Among them: eliminating both payroll and corporate taxes and introducing a broader business tax in their place. Donald Trump, a front-runner, has proposed a tax cut that by one estimate would put federal collections at their lowest since World War II.
RUBIO’S TAX MATH. Those new tax ideas. including a plan from Sen. Marco Rubio (R-Fla.), are also facing a lot of criticism. New York Magazine‘s Jonathan Chait has a look at the criticism of Rubio’s total tax code overhaul.
Thirty-four percent of the benefits of the plan would go to the highest-earning one percent of Americans (who, by the way, earn about 21 percent of all income). Rubio’s proposal deliberately provides some benefits to Americans of modest income, which means that its enormous tax cuts for the very rich come alongside some pretty decent-size tax cuts for the rest of us. All told, Rubio’s plan would reduce federal revenue by $11.8 trillion over the next decade. The entire Bush tax cuts cost about $3.4 trillion over a decade, making the Rubio tax cuts more than three times as costly.
CARSON RELEASES 15 PERCENT FLAT TAX PLAN. Count Ben Carson among the candidates pushing for a flat tax. On Monday, he released more information on his plan for a 15 percent across-the-board flat tax, Reuters reports.
Carson said he would extend the 15 percent tax rate to capital gains, now taxed at 20 percent. Foreign income would also be taxed at 15 percent, he said, adding that he would take steps to encourage U.S. companies to declare cash now held overseas.
Multinational corporations with money parked abroad currently face a 35 percent tax rate if they reclassify it to the United States.
Carson told Fox he “would declare a holiday on that tax” to bring such funds back but would require companies to invest 10 percent of that money into American communities to create U.S. jobs, although he gave no specific details.