This is all well and good, but your illustration TOTALLY IGNORES payroll taxes of 7.65% (yes I know it has been lowered this year, but that's temporary) which means an additional $3,825 in taxes.
Moreover, Cain's plan also removes the employer's match of payroll taxes and, at least in theory, many employers would pass on at least a portion of this money to their employees. Now, you can say all you want that employers won't do this, but I can tell you that whenever I hire someone I am adding 10-12% to their compensation to cover payroll matching and other benefits.
Art Laffer endorses 999
http://online.wsj.com/article/SB10001424052970204346104576637310315367804.html?mod=rss_opinion_main
BTW - all the candidates in last night debate were playing catch up to Cain’s plan with their ‘flattening’ of the current tax codes, better get on board the Cain train is leaving the station
I knew a guy that had a littlefella, and he was a bitter littlefella, it’s called littlefella’s littlefella complex, and I’m truly sorry for you, because the disease, in the third stage attacks the brain, and renders you incoherent.
Who pays sales tax on a home purchase?
I’m not passing judgement, good or bad on the 9-9-9 plan...but I know this. It won’t sell during the general election, and it will be a detriment to Cain (whom I think would make a good candidate, if it wasn’t for this one plan.)
When the MSM start milking the fact that the “poor”...who haven’t paid any taxes in “forever” (in fact they’ve gotten checks back from the gov’t when they paid nothing in due to credits)...will have to pay 9 percent sales tax on top of the state sales tax, which in our state is 7 percent...on the purchase of food, and medicine, and “necessities”...their cries and fear mongering will be heralded from the roof tops and Cain won’t be able to sell his plan to the general public.
Of course it will affect the women and children most, not to mention the disabled and elderly. /sarc And people will believe it and reject Cain. Now that’s just MHO, but I think it’s pretty accurate as to what will happen.
Selling 9 9 9 to the conservatives, that’s one thing, selling it to the independents...big problem.
My biggest fear of this plan is that it creates a new government revenue stream with the national sales tax. If the percentages across all three streams had an ironclad guarantee of 9% (could never be increased), then I would consider it but that is just not possible.
Current Tax System vs. Herman Cain 999 Tax Proposal
What would happen to the cost of a new house?
Retail price:
Now = $200000.00
999 = $170040.00
Local sales tax pct rate = 0.00%
Local sales tax dollars:
Now = $0.00
999 = $0.00
999 federal sales tax pct rate = 9.00%
999 federal sales tax dollars = $15303.60
Total cost with taxes:
Now = $200000.00
999 = $185343.60
Dollars saved with 999 plan = $14656.40
22% of the current cost of retail items is due to the current tax system. Herman Cain’s plan removes this hidden tax and replaces it with a 9% flat tax. The 999 price in this calculator has been adjusted to reflect this fact. Yes, that’s right. Retail prices willl go down under the 999 plan. The effect of the current tax code on retail prices has been well documented by the FairTax supporters. You can obtain documentation for this at fairtax.org.
Currently, yes. But under Cain's plan they would no longer have 15.3% deducted for Social Security and Medicare, meaning their combined incomes can be increased to $57,650 without any cost to their employers.
9% federal income tax is $5189. Using the "Chilean model" only the first $33,360 in annual wages is taxed at 10%. So, that's $3336.
Therefore, $57,650 - $5189 - $3336 = $49,125 after taxes. Under the current tax system they have $46,139 after taxes.
Gosh. Which one is better?
We don’t need our president to be a mathemetician, especially when he is bad at it.
Cain’s proposal is counter to conservatism. He proposes new taxes when what we need are spending cuts.
He is woefully lacking in leadership ability.
“Anyone up for paying $18,000 sales tax on the next $200,000 house you purchase?”
If your are like me (I bought a farm this year) for $210,000 you would have paid ZERO tax on your home because I bought a pre-existing home. Used goods are not taxed under the 999 plan.
If you didn’t know that, you should educate yourself before putting finger to keyboard. If you DID know that then you are purposefully lying.
Sales tax on house sale? Bravo Sierra. Only Obama would propose that.
I don’t think Cain’s 9-9-9 is well thought out, it’s just catchy.
At least one of his supposed economic advisors has backed off of it.
Cain already stated that only those buying a brand new home would pay a tax buying homes previously lived in zero tax. Whoever wrote this doesn’t know what they are talking about at all.
Also IIRC the first $20K is not taxed under this plan so in reality their income would be $30,000.
Not to worry, it’s only doomsday for poor and retired whites (that is, those who don’t live in the inner city).