Posted on 10/15/2011 10:09:54 AM PDT by rob777
There has been a lot of talk regarding where Cain got his 9% number for the income tax, sales tax and corporate tax. Apparently a full analysis was done by economist and former assistant to the director of the Office of Tax Analysis for the U.S. Treasury Gary Robbins. Robbins thinks that the plan would work economically, but would not sell politically:
“You’re trying to go to a system that taxes income once and only once and quits double-taxing savings,” Gary Robbins told POLITICO on Wednesday. “That’s something that can really juice the economy, it’s probably worth 15 percent in growth. … The problem with the big-bang changes like that, the flat tax or the fair tax, is that they are so alien to the current system that it would be a great big shock.”
Though Robbins says the plan would work fiscally and economically, he believes people would never accept such drastic changes. http://caucuses.desmoinesregister.com/2011/10/12/herman-cains-9-9-9-analyst-its-a-theory-not-a-solution/
The actual number that would allow the plan to be revenue neutral is 9.1% (See table 10c on page 8: http://www.politico.com/static/PPM191_111012_999scoringtables.html
And that is going to kill sales of new goods.
I have problems with Mr Cains plan.
Currently, raising taxes is usually an exercise in class warfare by targeting the rich and our collective envy lets us rationalize such theft is a public good, especially if we get some of the redistributed booty.
But, greed and envy aren't very good checks and balances against ever increasing taxing and spending. We simply elect more politicians who'll spread it around and here we are.
But, with everyone paying into the tax system, you have the ultimate check and balance of equal participation, thus greater scrutiny of what the taxes are and how the tax revenue is being spent.
With equal participation, any politician who raises taxes, raises YOUR taxes. Sound good to you?
The demonrats LOVE to raise taxes, but that only works if they raise someone else's taxes.
Are you going to vote for someone who raises YOUR taxes?
I hate discrimination and I applaud and support equal treatment for all, so I think the idea is brilliant.
Under Mr Cains plan, your $9.99 pizza will cost $10.89 PLUS state sales tax.
The first danger is that it opens a new revenue conduit to the Gov.
A national sales tax.
We’re already double and triple taxed under the current federal tax system:
I pay fed taxes out of my paycheck. Taxed once. I put the rest in a savings account, but later have to pay the “unearned” income tax on my interest. Taxed twice. When I take some of my savings to buy gas, a pack of smokes, or a bottle of booze, then I’m taxed a third time.
Correct, I think the debate will soon shift from “is 999 a good idea” to “how could this actually be done”? And here Mr. Cain’s brilliance comes through, because he’s going to have top brains across the country working to answer that problem and vying for airtime to explain how it might be done - all for free!
To those like Robbins who like the idea but worry about the practicality, “let now your heart be troubled”....
America has risen to the challenge of big, bold ideas before, remember?
“I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the Moon and returning him safely to the Earth.”
We did that, and we can do this too.
There is nothing to stop the current tax rates from being raised 20-40-50%
This fear that some day someone may raise 9-9-9 is totally misplaced. The same fear applies even more so to the current tax code.
Congress can simply raise the existing tax rates any time they want. Changing over to a more broad based tax in exchange for eliminating all the current corrupt gimmicks, loopholes and double taxation in the current code is something any Conservative should be for.
It also has the added advantage of making raising taxes much hard then it currently is. Now taxes can passed off as “a tax on business” or “making the rich pay their fair share”. Under 9-9-9 everyone pays so everyone knows they personally will pay more if taxes rates go up.
“And that is going to kill sales of new goods.”
Not true. Those who can afford new, will still buy new. People like me, who can’t currently afford to buy new will save enough income tax to buy more things new (yay)
Those who can’t afford to buy new, shouldn’t really be buying new anyway.
Food and medicine is another discussion, but reducing the 22% embedded tax will offset the sales tax on those things anyway.
If this pasased no one except the very rich would ever be able to afford a home again.
Sub contrators work on a very small margin, 5% or less and since his plan doesn’t allow business to deduct wages, which is 80% of the cost, the cost of housing would at least double!
Stick youe 999 plan where the sun doesn’t shine!
Only problem with that Perrybot attack line, as has been pointed out to you hundreds of times on other threads when you repeat the same fraudulent attack line, is that same fear applies much more to the current tax system
There is nothing to stop the current tax rates from being raised 20-40-50%
This fear that some day someone may raise 9-9-9 is totally misplaced. The same fear applies even more so to the current tax code.
Congress can simply raise the existing tax rates any time they want. Changing over to a more broad based tax in exchange for eliminating all the current corrupt gimmicks, loopholes and double taxation in the current code is something any Conservative should be for.
It also has the added advantage of making raising taxes much hard then it currently is. Now taxes can passed off as “a tax on business” or “making the rich pay their fair share”. Under 9-9-9 everyone pays so everyone knows they personally will pay more if taxes rates go up.
Because you already pay a hidden sales tax of 27% to 30% on all items you purchase via the Corporate tax that will be reduced to 9% (not to mention the costs involved in managing the tax system that won't be part of the overall expenses of COGS).
But you know that since it has been explained to your little Perrybot mind several hundreds of times before.
No you don't. You have a problem that Mr Cain is kicking Rick Perry's butt. That is your real problem
My argument is that a national sales tax gives the Gov one more way to tax us.
It gives them a new tool.
It also unfairly taxes current savings which have already been taxed.
What has any of that to do with Rick Perry?
Maybe. Maybe not. You can't buy everything used. And bartering only goes so far. The government may swoop in to tax garage sales, etc.
What of food and medicine? Has Mr Cain given any details? Or are we to HOPE that it all works out well?
I want answers, not just a bunch of crowing.
>The problem with the big-bang changes like that, the flat tax or the fair tax, is that they are so alien to the current system that it would be a great big shock.”
.. the only shock would be the loss of jobs for 16,000+ IRS criminals
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