Fred Thompson unveiled his tax plan on Sunday.
(CNN)–GOP White House hopeful Fred Thompson released a seven point tax plan Sunday, that he says will encourage new economic growth, and move the country toward a reform of the federal tax code.
"The solutions to challenges in our economy are found in the homes and small businesses of ordinary Americans, not in the halls of Washington," Thompson said in a press release from his campaign. "My plan allows Americans to have greater control of their own money."
Among the ideas his plan calls for, Thompson would permanently extend the 2001 and 2003 tax cuts, signed into law by President Bush that are due to expire in 2010. He would also repeal the estate tax, and the Alternative Minimum Tax, while also reducing the corporate tax rate from 35 percent to no more than 27 percent, and permanently extending small business expensing.
In addition, Thompson's plan also calls for allowing a choice for American taxpayers by allowing them to decide whether they remain under the current tax code, or opting for a flat tax code. The flat tax plan would contain two tax rates: 10% for joint filers on income of up to $100,000 ($50,000 for singles) and 25% on income above those amounts.
Thompson, along with his other rivals for the GOP nomination, is scheduled to be in St. Petersburg, Florida on Wednesday night for the CNN/You Tube debate.
Click here to see CNN's new political portal: CNNPolitics.com
– CNN Political Desk Editor Jamie Crawford
I really think this may work, and I am sooooo PUMPED UP about it THAT I CANT wait to tell the ZZZZzzzzz ( snore ) ZZzzzzzzZz, hmmm WHAT? oh yeah, I CANT WAIT TO TELL YA!
Its about, zzzzzZZZZzz, snore, GRRUMBLE, HUH? WHAT? oh yeah, its about the best I can come up with between catching my Z's
"How many bills related to tax relief did you introduce when you were in the Senate?"
Interesting question. The same question relating to a multitude of issues can be asked of all the other candidates Republican and Democrat. Now that they are running, they ALL have great ideas, but we they advocates before? Not likely. This is the time for promises made and promises made to be broken. Frankly, I think Hillary is the worst offender...she's on full tilt promising everything to everyone.
"But how can he cut taxes and balance the budget?"
Actually, if we were not in a war, the budget likely would be balanced. Taxes have been cut and tax revenues collected are at an all time high. Go figure.
This plan will do nothing to reduce the burden of all Governement taxes paid by individuals and payroll deduction. Individuals and payroll taxes are still greater than 50% of the total government tax revenue. After all other forms of federal revenue–corporate taxes are the smallest piece of the pie. This is intended to spur re-investment into plant/operations–and it has: China, Malasia, and Mexico have really benefited from the jobs created....but we haven't. I would like to see some realistic attention paid to the unfair differences between corporations and individuals with enormous earnings–versus indviduals and families making under $100,000 per year. It is unreasonable for me to accept the disparity in reason and logic that supports a tax system that allows the top earners in the system to pay a lessor percentage of their wages to the government. The trickle economic theories...carried on under new names....are not working. Greed is though. This man has no strategy for improving anybodies situation–just rewording and tweaking the same old junk that placed millions of Americans in the economic boat they're in.
Abolish the IRS. The "IRS" was implemented by Lincoln to help cover the cost of the reconstruction of America AFTER the Civil War...nothing else. Then it was repealed.
It was never intended to "fund" the programs that it now funds. This never-ending, no light at the end of the tunnel, tax EVERYTHING to pay for laziness was NOT the original intention.
I agree with abolishing the IRS.
"I hope not. Because like all of the other greedy and wealthy CEO's out there, when you raise taxes on me, I turn around and raise my prices. And in some cases have to lay off the employees who work for me. So who do you think a tax increase hurts more now, me or the other classes?
Use your head and quit spouting off illogical liberal talking points. True economic growth occurs when CEO's of companies prosper and provide jobs and spend a ton of their money on other people's stuff too."
I welcome your response but I said nothing about raising taxes on businesses, only that cutting taxes on them is supposed to spur economic growth but we have seen time and time again that rarely does this actually occur. This is all beside the point I was making, and obviously should have made more obvious, that Thompson's plan does not have any provision to pay for the lost revenue which would result from his plan. How does he plan to replace this lost revenue? He hasn't shown any sign of supporting a reduction in military spending by closing the war in Iraq. He hasn't given us any reason to believe that he would support reducing federal spending in any other area, so what are we to think? I don't believe that increasing the tax on businesses is a good idea, as evidenced by my second post, and I do believe that successful businesses promote economic growth but I know from experience that businesses will do just about anything to avoid paying taxes and maximize their profits. Not only that, but large businesses focus on increasing their profits quarter to quarter and any reduction in that typically causes them to take action that hurts workers. It's very complex but I don't see how reducing the tax on businesses is going to generate enough revenue to pay for what Thompson's plan loses, particularly since we have no statement from him indicating how he would lower spending. Like Toni wrote, the theory is great but the country is going broke and simply lowering taxes without lowering spending isn't going to cut it.
Oh and Stephan, I could care less about political labels or whether I subscribe to orthodox Libertarian (or even Republican) views. I am much more concerned with a President who makes the correct decisions for this country. I do see the disparity in classes in this country when we need to argue about whether social security taxes should be paid proportionally by people making less than $97,500 a year, and everyone who makes more. I see a large disparity when there is an entire subset of the US which benefits directly from the influence of government and the money stream. Ideally, I'd like to do away with the IRS and its complicated tax code, but that is unreasonable without either reducing federal spending and the size of government, or replacing that lost revenue. It's simple dollars and sense, and this plan doesn't have it.
Hope that clears things up.
"10% for joint filers on income of up to $100,000 ($50,000 for singles) and 25% on income above those amounts."
As a middle class person this plan is a tax increase for me and my wife (10%)and a huge tax cut for wealthly people. They love the idea of only paying 25%. They pay more right now. All this plan does is further gut the middle class so that 5% of the population can further surround themselves with Saudia Arabian style luxury.
Fred, Fred your head is dead.
Polish your dome and please go home.
A flat tax, or call it a "simple" tax, sounds good. But let's make it comprehensive and fair.
(1) It should apply to gross income. No tax breaks and loopholes to hide income. This includes to homeowner mortgage interest deductions as well as corporate jets.
2) Since corporations are legal entities (i.e. persons) as far as political speech is concerned, they get to pay the same rate .. on gross income.
(3) Investment income should be taxed no lower than income that is earned by holding down a job. Again, no tax-free bonds or other such gimmicks.
Think of how life would be simplified if your 1040 said .."How much did you make? Send the IRS 10%." We should encourage desirable behavior with subsidies that have sunset clauses, not tax breaks.
As for the estate tax, it should be adjusted for realistic, modern amounts, and maybe some items such as farm land or small business inventory can be exempted, but the basic idea of trying to prevent the rise of an aristocracy based on inherited wealth is a good one. The tax should not be repealed.