Skip to comments.Cain 9-9-9: Huge Tax Haul from VAT
Posted on 10/18/2011 2:41:08 PM PDT by Def Conservative
The Herman Cain campaign released details of the revenue expected to be collected from his 9-9-9 tax plan. Here are the estimates for 2010:
$701 billion from the 9 percent personal income tax. $753 billion from the 9 percent retail sales tax. $863 billion from the 9 percent business VAT. Yikes! By far the largest tax haul under the Cain plan would be from the business VATa tax which would be hidden from most voters.
By the way, the Cain business tax is not a tax on corporate income, as some media stories are identifying it. The new revenue data makes it clear that it is a tax on all value added by all businesses in the nationcorporate, partnership, and proprietorship.
Sorry Mr. Cain, I think your tax plan gives the federal government far too much room to grow in coming decades as entitlement cost pressures increase. Id suggest dropping 9-9-9 and going with my 15-15-15 tax plan. After that, you could move on to proposing a detailed plan for spending cuts, as candidate Ron Paul has delivered.
He’s pushing a VAT? I don’t like that idea.
Is it a retail sales tax or a VAT. I read both. People swear it’s a sales tax. Others swear it’s a vat.
Cain has to nail this down. His web site is ambiguous.
The business tax is a VAT.
9% sales tax applied on all new goods (.09xselling price before local & state sales tax) Used goods..no tax
9% income tax on gross earnings less charitable deductions
9% corporate tax on net earnings (salaries/payrolls not expensed)
No payroll tax, no cap gains tax, no death tax
Cain claims there are "hidden, secret, embedded" taxes in the price we pay for goods due to the taxes on business to business that are figured into the final price of goods.
The number I've most often heard is 22%. Cain says he wants to replace the "hidden embedded" 22% taxes with a visible 9% Fed Sales Tax...
People claim the Fed Sales Tax is good because it "captures revenue from illegal immigrants" at the cash registers.
But don't illegal immigrants pay MORE NOW with the "hidden embedded" 22% than they would under 9-9-9??
If 9-9-9 replaces 22% hidden taxes with 9% visible taxes, isn't that a Revenue SHORTFALL for the Fed Govt? How does that help us when we are $15 Trillion in debt?
Bush had a tax plan, cut taxes, cool. We need to Gut Gov't, where is that plan of his?
Wrong again. Look up "VAT Tax."
I’m going to take a shot at this..??.
Company A makes widgets and pay a 35% corporate tax so company A passes on his cost of goods including his tax liability to Company B that assembles the widgets into a product they retail. Company B may buy gadgets and materiel from multiple vendors, all of which pay 35% tax and include it in the final products they sell. Company B must pass on all their costs including their 35% tax in order to earn a profit.
Value Added Tax (VAT) is on product taxed at very point of production and is hidden in every product purchased. Cain’s corporate tax reduces the current 35% corporate tax to 9% which will be the lowest among industrialized nations worldwide. None of Cain’s 999 plan has double and triple taxation such as in the current system.
“9% on top of the already excised items as well? Gas, cigs, beer?”
If the oil companies ,beer brewers and the tobacco companies go from 35% to 9% in corporate tax, they will have to reduce their prices to the market. IE...gas $3 gal before excise tax may drop as much as 10% to $2.70 gal. The excise tax, sales tax and fed 9% would actually lower the cost at the pump by a few pennies.
It appears to me that CATO is misrepresenting different parts of Cain’s plans.
But if prices stay the same, doesn't the brand-new 9% Fed Sales Tax simply increase the cost of everything by 9%?
I don’t totally understand it either. However, if his plan generates less revenue than the current system, then I’m all for it. If the giant government brings in less money, then they will have to cut spending. Because, Mr. Cain is set at 9-9-9, and no more. I’d really like to hear more from Mr. Cain on spending. What is he going to do about this ridiculously huge government which is crushing the private citizen? Is his plan to choke it with 9-9-9, or does he plan on actually cutting spending?
This 999 this is supposed to be so simple, but it seems as if no one gets the same thing from what they think this 999 plan is or does. I know I'm totally confused.
sklar, I've been wondering what you just mentioned too. If we are taking the consumer-hidden taxes from the federal revenue and replacing that with such a lesser amount of federal tax revenue, I would think we would have to have corresponding tax cuts from the federal budget to align to the lesser federal revenue proceeds.
I'm certainly OK with a smaller federal government, but I would think we had better have cuts in place or at least ready to go when we start having that lesser federal revenue coming in.
Of course, as I said, I'm pretty much confused in all of this anyway and hear something different every day, so I really don't even know if I'm close to seeing the benefits verses the pitfalls.
One of many reasons we need to know more about the details. (This won't all get sorted out before election, but it's certainly going to have to get sorted out before it goes to Congress for vote.)