Perry says plan will 'free' Americans from lengthy tax code
October 25th, 2011
12:30 PM ET
11 years ago

Perry says plan will 'free' Americans from lengthy tax code

(CNN) - Rick Perry said Tuesday his plan of giving Americans a choice between their current income tax rate or a 20% flat-tax would "set our people free" from burdensome tax law.

"The size of the current code is more than 72,000 pages," Perry said to a crowd at a plastics company in South Carolina. "That's represented by this pallet right here and the reams of paper. That's what the current tax code looks like. The best representation of my plan is this postcard. This is the size of what we are talking about right here. Taxpayers will be able to fill this out and file their taxes on that."

Perry's proposal, which also lowers the corporate tax rate from 35% to 20% and eliminates the estate tax, includes provisions for taxpayers to maintain their deductions for mortgage interest and charitable donations. The standard deduction would increase to $12,500 for individuals and dependents.

The plan would also eliminate taxes on capital gains and dividends.

In his speech, Perry characterized his proposal as a jobs creation plan, saying the proposed reforms would encourage businesses to hire American workers.

"It is time to create incentives for American companies to invest in American workers," Perry said. "It is time to end the corporate loopholes, end the special tax breaks for special interests, end the gravy train for lobbyists and tax lawyers."

Perry also said he was committed to balancing the federal budget by 2020, saying reforms to entitlement spending and ending special interest payments would help close the cap between American spending and revenue.

Political Notebook: Listen here as Perry supporter Steve Forbes talks with CNN’s Bob Costantini about Perry's new tax plan.

He spelled out a number of specific proposals for Social Security, Medicare and Medicaid, including gradually increasing the retirement age and allowing state and ending wasteful spending and fraud.

Perry's flat-tax plan, the specifics of which first came to light Monday evening, has been drawing both praise and criticism.

In a statement circulated Tuesday, Pres. Barack Obama's re-election campaign slammed Perry's plan, saying it would hurt middle class taxpayers.

"The belief that middle class Americans will benefit if we just give another special break to those at the top was long ago discredited which is why the President is fighting to create jobs now, restore economic security for the middle class and extend a tax cut that would give the typical middle class family $1500 per year," Ben LaBolt, Obama's campaign press secretary, said in a statement.

Businessman Steve Forbes, who himself proposed a flat-tax when he was running for president in 1996 and 2000, told CNN Tuesday the Perry plan was superior to Herman Cain's "9-9-9" tax plan, which proposes levying a flat 9% tax on income.

"The Perry plan is cleaner and just takes the existing code, starts over with a single rate, generous deductions," Forbes said. Forbes formally endorsed Perry on Monday. "And you're literally going to be able to do it on a single sheet of paper."

Former House Majority Leader Dick Armey also voiced support for Perry's plan Tuesday, saying on CNN that it was the "best plan standing."

"The governor's plan is a very bold plan by way of comparison with anything else that's out there, and I think it is possible that it could achieve the growth of the American economy and the job creation that would follow that growth," Armey said. Armey is currently the chairman of FreedomWorks, a large conservative political group.

Also see:

Perry to meet with S.C. governor

Perry on Obama: 'It's fun to poke at him'

Perry to meet with DeMint

Filed under: 2012 • Rick Perry • South Carolina
soundoff (176 Responses)
  1. Anonymous

    The flat tax will make people who pay nothing now pay their fair share. The only people who object to it are the ones who are now paying $0. The only pitfall I see is how much will the percentage be and who has the authority to raise it.

    October 25, 2011 01:56 pm at 1:56 pm |
  2. Sniffit

    Watch how fast the MSM refuses to report about the results of studies from the Tax Policy Center or CBO or Brookings or other reputable non-partisan think tanks. The blackout on the results of studies of Cain's 9-9-9 nonsense was more than obvious...and they'll do the same for Parry when the results come out that his plan, like Cain's, would be a giant kick to the taint for the middle-class and poor and a "happy ending" for the rich and corporations.

    October 25, 2011 01:56 pm at 1:56 pm |
  3. Guest

    With each personal exemption equal to $12500 – a couple with 2 children would see their first $50K per year tax free. That is right folks – $50K per year tax free. And if you have mortgage interst – add that to the $50K because it is still going to be deductable. So more than 50% of Americans will pay ZERO Federal Income Tax! That is not fair.

    October 25, 2011 01:56 pm at 1:56 pm |
  4. humtake

    Nothing will ever change because no matter what plan is proposed by someone, the opponents of that person will just say it will hurt the low and middle class and then nobody will vote for it. That's the only strategy any politician knows anymore.

    October 25, 2011 01:58 pm at 1:58 pm |
  5. Jason

    I'm not surprised a bagger chooses to use language akin to old Nazi sayings.

    October 25, 2011 01:58 pm at 1:58 pm |
  6. tony

    Zero on dividends, zero on capital gains, zero on inheritance. So the already rich, and any-one with a decent Wall Street bonu , and their dynasty,t will never have to pay taxes ever again.

    October 25, 2011 01:58 pm at 1:58 pm |
  7. Anonymous

    1st election lost. You hear it hear 1st.

    October 25, 2011 01:59 pm at 1:59 pm |
  8. FedUpWithLife

    Another tax break for the rich.....Why do republicans hate the middle class so much???

    October 25, 2011 01:59 pm at 1:59 pm |
  9. Loathstheright

    He actually meant, it would set Millionaires free from paying taxes...the rest of you, well good luck, you're screwed.

    October 25, 2011 01:59 pm at 1:59 pm |
  10. Tom in the Great NW

    ..ANOTHER DUMB DUBYA......................AND DUBYA (ARE YOU READY?) HAD AN M.B.A.!!!!!!!!
    ...with a watchful eye on the teanut-gop, Tom in the Great NW.

    October 25, 2011 01:59 pm at 1:59 pm |
  11. Rickb

    Ray, let me try an honest answer. I'm in the upper 6% of income wages bracket around <250K. Doing just fine, but will never retire nor get rich (my children are at the <25% level with college educations and not doing well). At 20% flat rate, my taxes would go up. I have a family member doing much better than me. Not quite wealthy, but don't worry about a thing rich. They have no income, all money is derived from dividends and capital gains. If captial gains and dividends aren't taxed, then they pay 0% taxes and still live a comfortable life.

    October 25, 2011 02:00 pm at 2:00 pm |
  12. Aerin

    If you really want simple, how about a simple PROGRESSIVE tax.

    Each tax bracket pays 10% more than the lower. Deductions apply for the poor.

    October 25, 2011 02:02 pm at 2:02 pm |
  13. Frank

    He is just throwing things on the wall to see what sticks. That works with spaghetti but not with my future.

    October 25, 2011 02:04 pm at 2:04 pm |
  14. Bob

    I am an Independent voter....who would vote for Perry on this one....People I generally agree with? Is wrong about this flat rate...It's a good idea..a $12,500 standard deduction would be a windfall for middle class and the poor...the poor would pay nothing...and for the middle class? it would also lower their tax obligation. The rich would get a break at 20% instead of 35% which would encourage hiring more workers....and bring big business in Europe back to America where they belong....on the other hand? Cains 999 deal is a disaster for poor people and the middle class.

    October 25, 2011 02:04 pm at 2:04 pm |
  15. Rich

    Another Koch scam...And the uneducated GOP falls for something that will not benefit them at all...

    October 25, 2011 02:05 pm at 2:05 pm |
  16. rlgtulsa

    I can't believe what i'm hearing on here. You libs all say that the rich don't pay taxes, they need to pay more. Perry's plan does just that. Do the math, example here, if you make $10,000 per year, you pay $2,000 in taxes before deductions. You get an automatic $12,500 exemption, therefore, you pay 0 taxes and in fact, get back $10,500 (before deductions, etc).
    If you make $1,000,000 per year, you pay $200,000 in taxes, less the $12,500 automatic exemption, = $187,500. How is this unfair to the middle class?

    October 25, 2011 02:06 pm at 2:06 pm |
  17. John

    The Estate tax is vital for a democratic republic. Do you really want more people like Paris Hilton, with their inherited wealth running the country?

    October 25, 2011 02:06 pm at 2:06 pm |
  18. tony

    Same old tax code as Imperial Russia before the Communist revolution

    October 25, 2011 02:07 pm at 2:07 pm |
  19. Rickb

    Telly Joe, as an example, because a teacher (I'm not one) with an income of $30k of which almost half is paid for healthcare insurance cannot afford a mortage payment after paying 15%. A $1 million dollar income after 15% flat tax can still afford two 5,000 sq. ft. houses in CO after paying for other vactions etc.

    October 25, 2011 02:07 pm at 2:07 pm |
  20. rob

    What part of this equation does he not underestand? THE RICH MAKE THEIR MONEY OF INVESTMENT, NOT INCOME! What a complete fool.

    October 25, 2011 02:07 pm at 2:07 pm |
  21. Tex71

    As usual, the Republican's statements seem perfectly reasonable if you take "people" to mean only RICH people, and if "free" means free to profit from other people's hard labor without having to pay them or contribute in any way to the society that made you rich.

    October 25, 2011 02:09 pm at 2:09 pm |
  22. Tannim

    I like a flat tax–as long as the rate is 0%!

    October 25, 2011 02:10 pm at 2:10 pm |
  23. Mike P

    Flat tax only works if it is pro-rated. Those making less money pay a lower percentage, those making more, a higher percentage. 20% of someone making 50K has a lot more impact on their life than 20% for someone making over 100K. This same reasoning is why those making more keep making more. A 3% raise for a low paid employee making 20K means 600 bucks a year, a very modest raise, but someone making 120K would get 3600 bucks, and now the income disparity is 3000 more dollars between the two employees, and the gap grows larger. His plan is too simplistic and does not even out the taxes paid on a relative basis, which is the only way to make it equitable.

    October 25, 2011 02:10 pm at 2:10 pm |
  24. newt

    Meine Steuerplan macht frei!!

    October 25, 2011 02:10 pm at 2:10 pm |
  25. really??

    Sounds like the fair way everyone the same and then yes everyone pays of course the guy making 20k a year pays nothing now so he will hate it but it is best plan out there

    October 25, 2011 02:11 pm at 2:11 pm |
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