Posted on 02/18/2012 11:26:25 PM PST by JediJones
An antitax advocacy group zinged Republican presidential candidate Rick Santorum’s tax plan, giving him a grade of “D+” grade and the dubious honor of proposing what “may be the worst idea of any of the Republican candidates.”
”The good news is Santorum has gotten more specific about his tax plan since last month when we gave him a D+,” economist William McBride wrote on Thursday. “The bad news is… he’s gotten more specific.”
Mr. McBride said the biggest problem with Mr. Santorum’s proposal is the sharply different corporate tax rates he would establish. Mr. Santorum would halve the corporate tax rate to 17.5% from its current top rate of 35%. Manufacturers, however, would not have to pay any corporate taxes.
Mr. McBride said the idea is “grossly unfair,” and unlikely to gain traction in Washington. If it did, he said, many businesses would “suddenly claim to be a manufacturer.”
The tax group also took aim at Santorum’s suggestion to triple the tax deduction families can take for each child. “This is obviously a big tax cut, and might spur growth, or it might just spur child making,” Mr. McBride wrote. The Tax Foundation echoed concerns expressed earlier this week by the nonpartisan Tax Policy Center that tripling the child tax deduction could push more low-income families off the tax rolls.
While the Santorum campaign has filled in some of the details in recent weeks, big ones remain missing, Mr. McBride wrote. The plan would collapse the current six rates to just two — 10% and 28% — but it doesn’t specify who would pay those rates, he said, adding: ”That’s kind of important.”
(Excerpt) Read more at blogs.wsj.com ...
http://www.taxfoundation.org/blog/show/27875.html
We have some experience with this, through the manufacturing deduction that went into effect in 2004, which engendered a national conversation on the subtle distinctions between burger flipping and manufacturing. Ultimately, nearly every industry took and continues to take the manufacturing deduction, based on IRS data.
...we could expect a much bigger effect of such a grossly differential corporate rate. It would likely result in everyone claiming to be a manufacturer.
He also plans to reduce taxes on capital gains and dividends from the current 15 percent to 12 percent. That seems almost inconsequential and certainly timid compared to most of the other candidates who are proposing to eliminate these taxes all together.
I am NOT surprised.
Unlike Newt Gingrich, Santorum has no real plan.
His was a vanity run for VP and he’s the very lucky recipient of Romney’s vicious lies of smears of Newt Gingich who was otherwise running away with this election on his postive campaign of radical, and solid ideas and solutions which are sorely and desperately needed if we’re going to have ANY HOPE at all of saving and restoring our Republic!
GO NEWT!!!
The tripling of the child deduction is LONG overdue. The idea that it might spur more children is great, we need then to grow up and work to pay into Social Security and make it a viable program. It would also allow for one of the parents to stay home and raise their children. It is long past time that the deduction gets close to the actual cost associated with child rearing. It is good for the family and subsequently the society.
Yes and yes.
There’s really no argument to be made for Rick that doesn’t include abject denial of the capability and competency Newt is offering.
That’s why you never hear from a Santorum supporter about Saint Rick’s excellent, visionary platform. It always starts off with “Newt is a SOB!”, or something along those lines.
The 0 percent for manufacturers is most likely Rick’s way of paying back his union buddies, who will just support the libs anyway. It’s also playing favorites. It’s funny that I heard him call this a “flat tax”, even though it’s 17 percent and 0 percent, two different tax rates. I don’t understand why he doesn’t call for eradicating the Capital Gains Tax. Makes no sense to me at all.
I prefer a fair tax myself. I actually really like Cain’s 999, and he promises to continue campaigning on it. After this nomination fight is over and we have Newt, I’m jumping back on the Cain train and will do all I can to promote it (which isn’t much). Nevertheless, Newt offers a flat tax at 15 percent, and corporate flat tax at 12.5 percent. No favoritism here. It’s a good step in the right direction towards a truly equitable tax system. Each person paying the SAME amount, no favorites, no picking winners and losers, no using government to discourage certain business or encourage others at the expense of still many more.
It’s my dream to one day see the progressive tax system we have now utterly destroyed and incapable of resurrection. Destroying it would do this country a lot of good.
I’d like to see more analysis on the child tax credit as an economic benefit. My suspicion is that it would spur more low-income households to have children, which would then need to be supported by the welfare state in countless other ways for decades to come. It would be dubious to me whether the financial losses on that welfare would pay off with increased social security revenue later on.
The problems with social security are much more fundamental than that. Like any Ponzi scheme, simply finding more new people to pay into the system is not a long-term or permanent solution.
Newt has the real solution to the social security system...private accounts that each individual would control. Like he said, it would require other funding to get us “over the hump” for current retirees as workers’ funds are diverted into personal accounts, but after that short-term pain we would be locked into a solvent system in the long-term. The Ponzi scheme has to stop and a sane system needs to be developed to replace it.
Having more children is a good thing for society, but there needs to be a broader message and effort made to that end. Motivating it solely through the welfare system and tax code doesn’t motivate 100% of the population anyway.
I also don’t believe keeping half the population “barefoot and pregnant” can sustain our economy. The world is too competitive now. In Europe we’re already seeing women performing better in the kind of jobs that are available in modern western countries. If laws have any role, they ought to promote more flex time, maternity leave or protection of a woman’s job during pregnancy. I don’t think children necessarily benefit from being coddled 24/7 throughout their young lives either. The idea that a woman would stay home and do nothing for her entire life but raise children seems like a real waste of potential, particularly once you get to the point where those children are in school throughout the day. To a certain degree, promoting this kind of society would result in my tax dollars ending up paying for someone to sit at home and watch soaps or play video games on Facebook most of the day. I think we all know how families handled their financial burdens decades ago, they didn’t live beyond their means. Funding people with welfare so that they never have to make tough choices about their budgets and lifestyle is not the way to go.
The child tax deduction does not need to be tripled — it needs to be abolished.
Remember, every tax deduction that favors one person is using government force to take those same tax dollars from somebody else. People should only have children if they can afford them on their own — not by forcing their childless neighbors to carry their tax burden.
This type of thinking is Rick’s problem — he thinks government social engineering is great ... as long as he’s the one doing the dictating of what is “good” and “bad” behavior.
Just make it simple like Newt’s ( ya stupid’s ), but Romney and Santorum are both LAWYERS!
No more damn lawyers!
The goal for our country is not to provide enough welfare, redistributive justice and transfer payments so that no one ever has to live in the lower class. There have been plenty of wonderful people who grew up in a poor family or the lower class and worked their way up.
Exactly. Rick’s tax plan is nothing but a list of vote-buying favors. He wants to make the tax code more complicated rather than less.
I like Newt’s plan better. It is better conceived, although I think it needs at least one tweak: If someone chooses to use deductions and credits to get a rate lower than 15%, what they owe should never fall below 10% of AGI. No more tax freeloading for anybody. I don’t care how many children YOU decided to have or how many electric cars YOU chose to buy or whether YOU get you income from labor or dividends or capital gains. Those were YOUR decisions and don’t deserve special treatment that only ends up forcing someone else to pay your tax burden instead of paying your own way.
What Rick is offering in many cases is the kind of stuff that destroys and corrupts our political system. He is offering tailored payouts to favored constituencies, in essence buying votes. He tries to couch this stuff in flowery terms about how things like "manufacturing" and "families" are what America's all about or will "make America great" again. But that's just spin. He's buying votes the same way that Obama bought votes. It's truly disheartening to see politics reduced to seeing which candidate in either party can use taxpayer money to bribe the right groups of people to win an election. We desperately need fair, equitable government policy like Newt is proposing which truly gives us all an equal chance to pursue happiness on a level playing field. Rick is the worst offender in the whole Republican field at playing the Democrat game of dividing the population up and trying to build vote-buying into the tax code.
I concur.
Well, you’d have a bigger disagreement with Newt’s policy then because he is eliminating the capital gains tax entirely (not sure if that’s just the “long-term” cap gains tax or if the time distinction goes away). You have to believe that the cap gains tax has a direct relationship to spurring on investment and building the economy in order to believe that’s the right policy. I haven’t studied the issue in great depth to be able to argue the case one way or another. But for a long time our long-term cap gains tax has been intentionally lower than the income tax, that’s for sure.
there he goes again.............
Santorum is horrible and so are his plans.
I hope people come to their senses and drop Rick prior to Super Tuesday. Newt needs to make a big comeback. Newt must successfully paint both Rick (because of this lame tax favoritism) and Romney (because of Romneycare) as government busybodies and no different than any other nanny-stater.
I do disagree on the cap gains tax, but I consider it minor compared to the other issue of allowing deductions and credits to create swaths of tax freeloaders.
Taxes on capital gains and dividends is bad mostly because it amounts to double taxation — a tax on the corporate profits already reduces the value of the shares and therefor a tax on the shareholders profits amounts to double taxation.
Personally, I’d completely eliminate the corporate income tax and the employer-side payroll tax. I’d replace them with a 10% tax on payroll costs, including the embedded labor costs of imports ala Cain. Hence the corporate profits would not be taxed ... until they landed in a shareholder’s pocket as capital gains or dividends. So I would eliminate the double taxation, just as Newt does, but it would also eliminate all the overhead of tax compliance and lobbying which a simple corporate rate cut does not accomplish.
Santorum’s lack of vision and thoroughness are what have me in Newt’s camp.
His ideas and plans are old hash and proven failures. They have short term emotional appeal for the uninitiated and the uninformed. They sound good but that’s as far as they go; just good soundbites.
Still I want to see Romney defeated at all cost and let Newt and Santorum vie for the top spot. Gingrich-Santorum is not a bad combo but Newt has the vision, philosophy, experience and knowledge of history over Santorum.
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