Rick Perry, Seeking GOP Nomination, Unveils Flat-Tax Plan
Texas Gov. Rick Perry - seeking to position himself for victory in the Republican Presidential nomination process - previewed a flat-tax proposal on Tuesday, saying his plan would give Americans a choice between a 20 percent income tax or keeping their current income tax rate.
Perry's plan would also preserve certain tax breaks for families earning less than $500,000 per year while increasing the standard deduction to $12,500 for individuals and dependents.
He said the plan would save up to $483 billion in compliance costs. Perry will also abolish the “death tax,” also known as the estate tax, which is imposed when a person dies.
Perry also calls for lowering the corporate tax rate to 20 percent.he said he would encourage repatriation of $1.4 trillion in money outside the U.S. by temporarily lowering the rate to 5.25 percent.
Perry also said he would push to eliminate the tax on Social Security benefits. The cut applies to 17 million SS beneficiaries who are taxed if they continue to work and earn income in addition to Social Security earnings.
He would also eliminate a tax on qualified dividends and long-term capital gains.
Perry said he would establish a goal to balance the budget by 2020.
“It will be an extremely difficult task exacerbated by the current economic crisis and our need for significant tax cuts to spur growth. But that growth is what will get us to balance, if we are willing to make the hard decisions of cutting,” Perry wrote.
Perry said he wants to cap federal spending at 18 percent of the nation’s gross domestic product. And passing a Balanced Budget Amendment to the Constitution.
He would also “freeze” federal civilian hiring and salaries.
Perry also called for repealing the Sarbanes-Oxley Act, a 2002 law that put in new rules for public company boards, and public accounting firms.
“[T]he U.S. government spends too much. Taxes are too high, too complex, too riddled with special interest loopholes. And our entitlement system is unsustainable in the long run,” he wrote in an opinion piece published in the Wall Street Journal.
“On Tuesday I will announce my "Cut, Balance and Grow" plan to scrap the current tax code, lower and simplify tax rates, cut spending and balance the federal budget, reform entitlements, and grow jobs and economic opportunity,” he said.