Nearly every Republican candidate supports some form of tax overhaul when asked to consider the current system. Senator Rand Paul has now offered some details of the tax plan he will be pushing as he campaigns for president. It’s called the “The Fair and Flat Tax,” which is a mixture of two major existing tax plans pushed by various tax reform groups.
Report from CBS News:
Republican presidential candidate Rand Paul unveiled his version of a flat tax on Thursday, proposing to “blow up the tax code and start over “in a Wall Street Journal editorial.
“The tax code has grown so corrupt, complicated, intrusive and antigrowth that I’ve concluded the system isn’t fixable,” Paul, a freshman senator from Kentucky, wrote.
In its place, he called for “an over $2 trillion tax cut that would repeal the entire IRS tax code…and replace it with a low, broad-based tax of 14.5 [percent] on individuals and businesses.” Under Paul’s plan, all forms of income would be taxed at that level, including wages, dividends, capital gains, and interest.
“All deductions except for a mortgage and charities would be eliminated,” Paul wrote. “The first $50,000 of income for a family of four would not be taxed. For low-income working families, the plan would retain the earned-income tax credit.”
The plan, dubbed “The Fair and Flat Tax,” would also eliminate “nearly every special interest loophole,” Paul explained, along with the payroll tax and federal taxes like the gift tax and the estate tax.
The elimination of “nearly every special interest loophole” always seems to derail tax proposals. Reforming the tax code almost always involves eliminating special breaks for various industries or businesses, and they fight tooth and nail to prevent such action. Other candidates will surely unveil their own tax plans in the coming months, especially leading into the debates.