Herman Cain’s catchy 9-9-9 tax overhaul system is gathering major supporters as the former pizza magnate consolidates his position at the top of the Republican field in the race for the White House.
House budget committee chairman Rep. Paul Ryan and Ronald Reagan’s economic guru Art Laffer both expressed their support for the plan which would replace the current tax code.
The anti-tax Club for Growth also came out in favor of Cain’s plan which would cut income and corporate taxes to 9 percent and institute a new national sales tax at the same level. Payroll, capital gains and estate taxes would all be eliminated under Cain’s proposals.
Eventually Cain’s plan calls for the complete elimination of income taxes – and the IRS – and the introduction of what he calls the Fair Tax, in which the all Federal revenue would come from a sales tax.
“I love the 9-9-9 plan, it’s a great first step,” Laffer told Fox News’ Bret Baier. “This is a lot better than our current tax laws that are filled with all sorts of ducks, chickens, pigs and turkeys. They’ve just got to be cleaned out and we’ve got to completely revamp the codes.”
Ryan didn’t go quite as far. The Wisconsin congressman did not endorse the plan, but praised it saying he loved “specific and credible” proposals.
Club for Growth president Chris Chocola called the 9-9-9 “an outline for a more prosperous and globally competitive America,” saying it is “both pro-growth and a good starting point on the way to a flat or fair tax.
“Eliminating taxes on capital gains and dividends and combining that with huge rate cuts in both corporate and income taxes would create an unparalleled economic boom,” said Chocola. “9-9-9 also eliminates the regulatory and compliance costs from the current tax code that suck billions out of the economy each year.”
Much of the criticism of the plan has been the idea of a new sales tax, which critics fear would be bound to grow. But Chocola dismissed those fears. “Of course a future Congress could raise taxes above the 9 percent levels, but under our current monstrosity of a tax system, Congress already can raise taxes at any time and often has. It is on a path to do so yet again next year with the expiration of the Bush tax cuts.
“Herman Cain’s proposal might not be the perfect plan, but it is a truly revolutionary tax reform that would amount to a massive job creating tax cut on investments, savings, and income.”
I would love to see Herman Cain get the Republican nomination.
yes tibby,
It make sense, CANADA HAS THE SALES TAX, and It’s fair that everyone pay tax,
rich and poor , which for many don’t have to pay very expansive fees for what the working class has to pay, for let’s name one transportation requiring them to move to their work place,
and what other cost required them all connected to their working schedule,
as oppose to the other poor which collect welfare and can round up his budget on without exterieur
very costly demand always created because of a job’s many other demands including climate fluctuations, never expected, but often present to bring extra cost, out of many more.
My question to Mr. Cain is what is his plan “B” if he cannot get his 999 plan passed by Congress. I like the plan but don’t know enough about it to get 100% behind the plan.
Here are some of the problems with Cain’s 9-9-9 plan. If, and that is a big IF, he could get Congress to go along with it, this Congress cannot commit future Congresses to any set tax.
Another thing is that Congress does not control state taxes. Those taxes are legislated by the individual states. Sales tax is now a state, county and local purview. The revenue from those sales taxes is a guarantee for the states as it is the only revenue that is not forwarded to the federal government, but used to cover state expenditures. The states are not going to give up that source of revenue, so there is a good possibility that sales tax could rise to almost 20% in certain areas.
And what about states that charge no sales tax on groceries and medications. Imposing a 9% sales tax on those items, the two biggest budget items for the lower income and senior segments, would decrease their buying power by 9%. And if I understand correctly, Cain’s system of prebates would apply to taxable income, when those very low income/seniors pay basically nothing now in income tax. Does that mean that we would have to create another department within the IRS to return to them what they paid in sales tax? Do we give certain people sale tax exemption cards? Would it work like the EITC? If, by imposing an addition 9% federal sales tax, without abolishing the state sales taxes (which state are not going to do in the hopes that the federal government will return that money to them) you will see LESS demand for goods and services, not more. Less demand, fewer jobs. More demand, more jobs.
Cain’s economic advisor (who is NOT an economist) said today on Fox that the 9-9-9 was basically just picked out of the air by Mr. Cain who thought 9% was a fair percentage and that the Cain plan is just a take-off of the Fair Tax. Federal income tax codes now are very confusing. The Fair Tax would charge sales tax on new cars, but not used cars. Do we really need another tax code that is just as confusing?
If you want a fair, and equatable tax system, we need a flat tax. You make X, you pay a flat percentage in taxes. No deductions for children it was your choice to have, no deductions for mortgage interest, no deductions for charity. For businesses, one simple form: you earned X making a product. It cost you Y to produce that product. X minus Y equals Z, which is the money you pay taxes on by the same percentage as the individual tax payer.
Cain’s 9-9-9 plan sounds catchy, but it has a lot of problems and while I am not a fan, Michele Bachmann is correct, would open a whole new source of abuse by Congress in passing tax rates.
Thats a good sign, along with some other recent backers who have signed on as well. Cains plan is only a beginning, a starting point to begin the battle with congress when he gets elected. But as for all these naysayers who say that his plan will be hijacked by congress as just another money pipe for them, they are right but wrong. Congress will always try to steal more money than they need. But someone has to step up and begin the battle of taking these politicians on. Its good first step towards the ultimate goal. So far all the others can do is cry how you can’t stop congress from taking money. Dah! Really? Thats why so many people are interested in Cain, he is actually trying to do something different than make excuse as to why our government is so screwed up. He is working on real solutions, not living in and accepting the problem.
Our present tax code has been abducted and raped by so many congresses that no one can ever repair the damage and future congresses and idiots like Charlie Rangel are just salivating at the opportunity to get the tax code in bed and write things for their corporate sponsors. These bills can be worded so that hanky panky by the charlie Rangel types can be avoided. Why do we men who would be considered felons outside of politics writing the tax code? Part of the responsibility is ours for allowing this travesty that steals money from the government and ultimately us for their own political and financial gain. This must come to a stop; rewriting the tax codes by the Chairman of theWays and Means Chairman is seen as a way to get rich, rather than a way to serve your country. End the corruption with a new tax code. We worry about new congressmen being on the take, they are on the take if they have the access. End the corruption and cut off the access to our tax code by criminals in congress.
@Gary G. Swenchonis:
It doesn’t eliminate the fact that Congress, not the President, is in charge of tax rates. If Cain cannot convince a majority of Congress, and then the Senate, to radify his tax proposals, then all this is for naught.
I think Herman Cain is a good man. But there is not one thing in his history that tells me how he will govern. And there is nothing in his history that gives me any indication how he will be on any of the other issues that we face as a nation. Taxes are just one piece of the puzzle, they are not the only concern this nation has.
retire05, hi,
I hope you read the RICK PERRY new message speech,
that is concentrate on jobs, bye
@ilovebeeswarzone:
Texas is facing losing thousands of jobs because of the new EPA rules, that btw, violate the Clean Air Act. Now it seems that the EPA has extended it’s new set of regulations on power plants that it imposed on states. Well, that is, for all states, but Texas.
The power plant nearest to me just completed a four year, multi-million dollar retrofit for using clean coal technology. The econuts in Austin started screaming “Oh, look at all the pollution coming out of those smoke stacks” because they were too damn stupid to know that what was coming out of the stacks was nothing more than steam. The retrofit to clean coal technology reduced polution by 97%. But that is not good enough for Obama’s EPA.
Green technology has been around for 40 years. Yet it is still unaffordable for energy production. But when the technology is developed where green energy can be produced at a reasonable cost, companies and energy suppliers will jump on it like a bird jumps on a worm. Until then, our nations still runs on energy. Every home, every business, is dependent on electricity. We need to use what we have and still promote R & D that will create “affordable” alternate sources of energy.
Our reliance on Middle Eastern oil has increased since Obama took office. That is not a good thing. Canada, on the other hand, literally pulled itself out of economic dolldrums by drilling and is now our largest supplier of oil.
retire05, hi,
It’s obvious to see what TEXAS is against, all those regulations are anti production,
that’s why I like GOVERNOR PERRY PROFILE to become a stern maker and to be able to discern the REGULATOR’S MOTIVES, that are stuck on TEXAS lately, and will maintain their pressure until the 2012 election, not certainly helping the creation of jobs in the US,
but certainly to help the miserably failing OBAMA’S PROGRAMS rejected by both party that is his own DEMOCRATS which getting out of his mantra to think together the same as their failed LEADER,
BUT THEY ARE KIND OF LATE TO HELP THE CHANGE OF GOVERNMENT LEADERSHIP
AFTER PARTICIPATING IN ALL THE ERRORS of judgement their leader tried to imposed since 2008
ELECTION still at this time questioned validity,but passed narrowly because of being afraid of the label racist which they used liberaly to silence even the faux birth certificat of OBAMA still not corrected,
after so much TAXPAYER MONEY where swindled to silence the source and hide the truth.
unfortunatly, this contributed to the worse for the jobs’s seekers of all trades in this beautiful AMERICA,
where the law abiding people now will vote a new PRESIDENT WHO CAN DELIVER THE JOBS, in the first 100 days of his term, that is the most positive I have read till now rising above any oder problems to be handle by the new futur PRESIDENT VOTED IN BY THE PEOPLE OF AMERICA WHO DESRVE THE BEST EFFICIENTCY IN THE LEADERSHIP AND THE REST OF GOVERNMENT’S JOBS, WHICH
ARE NOT FOCUS NOW ON THE BETTERNESS OF THE PEOPLE, BUT ON THE BETTERNESS MORE ON THE FORHEIGN COUNTRIES WHICH HATE AMERICA,
THIS IS awfull specialy for the BRAVES IN WARZONES, which are multiplying by the days with
OBAMA being fixed on sending THE TROUPS IN SMALL NUMBERS SCATTERING THEM ALL AROUND A CIRCLE OF HATERS, WITHOUT EVEN ASKING THE CONGRESS TO APPROVE ON HIS DECISION.
UNTHINKEBLE FROM THIS PRESIDENT TO IGNORE THE LAWS OF WHICH HE SWORE TO ABIDE TO ON HIS INAUGURATION IN 2008, NOW LOOK AT WHAT WE ARE FACING, AND 2012 DOESN’T COME FAST ENOUGH, when you are dealing with a destructive entity, which is out to get worse,
Effectively written article, very helpful.