Look Cain-bot, I am a Cain fan , look at my tagline.
Try reading the article for a change. Schiff gives respectful honest critique of 9-9-9 open for serious discussion. He is no Perry-bot or a Cain-bot like you.
I am not nuking my braincells for any candidate.
Well, I disagree with Schiff on a couple points.
First, he implies that the 9% sales tax applies to almost all of a person’s spending. This is clearly wrong, since Cain’s 9% sales tax only applies to new goods. It excludes services like rent, utilities, professional services like dentist, doctor, haircut, insurance, etc. as well as previously owned cars and homes. That is 70% of spending, and the 9% sales tax will apply to only 30% of spending for low income people. The 9% sales tax means less than 3% of income going to the sales tax. Personally, I think this is a mistake. If the sales tax rate was 4% rather than 9%, but included services, it would raise more revenue and engender less evasion. (Then again, the amount of revenue that will come from Cain’s sales tax is only $300B/yr — not enough to justify opening the door to another tax for Congress to manipulate. If the Income Tax and Business Tax portions were each 10% instead of 9%, and the capital gains income and SS income and employer non-cash compensation were not excluded from income, they’d produce enough revenue that the sales tax would be unnecessary.)
Second, the “business tax” is not presented as a flat rate corporate income tax. It is not a tax on “income” but a tax on “business”. It is essentially a Gross Receipts tax — with deductions for purchases from other DOMESTIC businesses. I don’t see any attempt to hide the fact that payroll is not deductible and is therefor subject to the 9% tax rate. Unlike Schiff, I think this is a high point of the ‘9-9-9’ plan. It replaces a punishingly high tax rate on corporate profits and low rate payroll tax with a single low rate tax on profits, payroll, and ... imports. Yes, businesses cannot deduct their cost of goods sold if they were purchased from foreign suppliers. This is a backdoor 9% tariff without violating trade agreements. Tit for tat for the way other countries rebate their VAT back to their producers if they export to the USA.