Anybody have an opinion on Herman Cain’s 999 tax reform plan?
- It ends the Payroll Tax completely
- Business Flat Tax – 9%
- Gross income less all investments, all purchases from other businesses and all dividends paid to shareholders
- Empowerment Zones will offer additional deductions for payroll employed in the zone
- Individual Flat Tax – 9%
- Gross income less charitable deductions
- Empowerment Zones will offer additional deductions for those living and/or working in the zone
- National Sales Tax – 9%
I don’t like it. This puts into effect both an income tax and a federal sales tax. Anyone doubt both those will be eventually be raised?
Under Cain’s plan your income will be taxed before you spend it (as it is now) and you’ll pay a new federal sales tax when you spend your money. Plus, you’ll be paying that 9% business too when you make a purchase because businesses will build their tax into the price you pay.
Apparently that is just Phase 1 but all he mentions in the debate. Phase 2 moves to a Fair Tax but I don’t know how things change with that.