Tuesday, October 18, 2011

Laffer - 9-9-9 not a joke

Arthur Laffer documents his thoughts on Herman Cain's 9-9-9 plan. The debate was increasing frustrating tonight due to Bachmann, Romney and Perry routinely providing false and misleading analogies on Cain's plan. Here is the math:

Current tax code: 25% income tax + 9% sales tax = 34%

9-9-9: 9% income tax + 9% federal sales tax (only on goods you choose to buy new) + 9% state sales tax = 27%

Now, the argument will be made that the poor now must pay 9% income tax under this plan. At what point should people have skin in the game? When 47% of the country pays no federal income tax and yet receive benefits beyond what this country can afford, are we supposed to seek our own financial demise?

Arthur B. Laffer: Cain's Stimulating '9-9-9' Tax ReformIt used to be that the sole purpose of the tax code was to raise the necessary funds to run government. But in today's world the tax mandate has many more facets. These include income redistribution, encouraging favored industries, and discouraging unfavorable behavior.

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