ANALYSIS: Cain’s ’999′ Plan Would Cause Largest Deficits Since WWII, While Increasing Taxes For Most

[Donnachaidh]

ANALYSIS: Cain’s ’999′ Plan Would Cause Largest Deficits Since WWII, While Increasing Taxes Fo...

http://thinkprogress.org/economy/2011/10/05/336649/cain-999-analysis-deficits/

2012 GOP presidential hopeful Herman Cain — who has seen a recent surge in the polls — has been trumpeting the supposed benefits of his “999″ economic plan, which would implement a 9 percent flat-tax on personal income and corporate income, along with a 9 percent national sales tax, while scrapping the rest of the tax code (including all of the deductions and all of the taxes on investment income such as capital gains).

Cain claims that his plan would not be “regressive on the poor,” but economists disagree due to the imposition of a national sales tax that would wallop the poor significantly harder than the rich. Cain also claims the plan will be revenue-neutral, in that it would raise as much revenue as the current tax code. I had Center for American Progress Director of Tax and Budget Policy Michael Linden run the numbers on Cain’s plan, and it turns out that it wouldn’t be deficit-neutral — not even close (all calculations are based on 2007 tax data, the last year before the Great Recession):

– For the income tax portion: In 2007, total Adjusted Gross Income on all income tax returns was $8.7 trillion. Since Cain’s plan would exempt investment income, but would have no other deductions, that brings taxable income down to $7.4 trillion. A flat 9 percent tax would therefore have yielded about $665 billion in income tax revenue.

– For the corporate tax portion: In 2007, there was a total of $1.3 trillion in reported corporate income subject to tax. A flat 9 percent would have yielded $112 billion in revenue.

More at the link --

[pinboy3niner]

1. It's been called 'Plan 999 from Outer Space'

:rofl:

[roguevalley]

7. SNORT! Another reason I love this place.

[Lint Head]

2. upside down

[glinda]

3. At risk for doing this.... maybe this is what he means...

http://www.youtube.com/watch?v=1MLry6Cn_D4

[n2doc]

4. And I'll bet their solution would be to double the sales tax

With a 'cap' on items over 50K. So the 'Yacht builders' don't get harmed, y'know.

[jwirr]

5. Question: Is that a 9% federal sales tax on top of state, county and local

sales taxes? Here in MN we do not have sales taxes on food or clothes. I do not know about medicines. Would anything be exempt in his sales tax? This would destroy the poor. If the rest of this idea is as bad as this one we have got to be crazy just listening to anything he says.

[Shandris]

6. In Indiana its everything but actual food.

6% State on everything. Add 9% to that? Go Die In A Fire, Herman.

I wonder if he's religious enough to recognize that passing that Bill would turn America into Abel.