The greatest advantage of the Rick Perry plan is the 20% flat rate on individual and corporate income, a great 15% drop from the current top rate of 35%. Perry aims to eliminate the taxes on capital gain dividends and estates. He would maintain the mortgage and charitable deductions for people that make under $500,000 a year and give everyone the opportunity to stay in the current tax system if that appeals to them. Now he also has a spending plan to try to offset the loss of revenue and balance the budget by 2020. Governor would limit spending to 18% of America’s gross domestic product. Additionally, he aims to lift the social security retirement age and lower the benefit calculation for high earners. He did not further detail who are those who belong to higher earning individuals. Mr. Perry would rein in Medicare and Medicaid, again, unspecified reductions. The question however is whether or not his plans will create an instant success and help in overcoming the deficit. The issue of shortage has been taken for granted and because of this we have been downgraded by Standard & Poor's. According to him, the economic growth and the money generated with the cuts on the budget will be adequate.
Governor Perry gives the people a choice, of te old tax plan works for you, you do not need to adapt the new tax plan. Everybody has a choice whether not to have a tax increase or get a tax cut. Taxes will not go up, this also goes true for everyone else. His standard personal exemption deduction is also quite high amounting to $12,500 per person. This will result to bg tax cuts in the end. He's avoiding the trap that Herman Cain fell into which was that Herman Cain also has high tax cuts at the top, but he raises taxes in the middle of the spectrum and bottom of the spectrum, he tried to repair that lately.
Rick Perry is not unique to creating a built in plan like this. Politician Newt Gingrich also has an optional system adapted in his plan. According to Gingrich that if Americans think that the plan will lead them to success then they will choose it voluntarily. Perry seems to be trying to reassure people that nobody's taxes are going to go up compared to what they are now.
Perry's party released details to substantiate his argument. Read on the following:
“CUT, BALANCE, AND GROW”
CUT Taxes and Spending. BALANCE the Budget by 2020. GROW Jobs and the Economy.
FIX THE TAX CODE
Institute Individual Flat Income Tax Rate of 20%
Allow Individuals to Choose Existing Tax Code or Simple Flat Tax System
Preserve Deductions for Mortgage Interest, Charity, and State/Local Taxes
Include Standard Exemption for Individuals/Dependents of $12,500
Standard Exemptions and Other Deductions are Phased Out for Filers with Annual Incomes Above $500,000
Eliminate Tax on Social Security Benefits
Eliminate Tax on Dividends and Capital Gains
Eliminate Death Tax
No Federal Sales Tax or Value-Added Tax
Reduce Corporate Income Tax Rate to 20% to Enhance American Competitiveness
Eliminate Corporate Loopholes and Special-Interest Tax Breaks
Transition to a Territorial Tax System
Allow Locked-Up Overseas Capital to be Brought Back to the U.S. at a Reduced Tax Rate of 5.25%
FIX THE FEDERAL REGULATORY SYSTEM
Immediate Moratorium on All Pending Regulations
Full Audit of Every Regulation Passed Since 2008
Regulations that fail audit will be repealed
Federal Regulations Automatically Sunset Unless Congress Renews Them
Institute Annual Regulatory Budget for Each Agency
Create a Searchable Public Database with All Regulations Currently in Force
FIX SOCIAL SECURITY FOR ALL GENERATIONS OF AMERICANS
Preserve Benefits for Current and Near-Term Social Security Beneficiaries Protect Social Security Trust Fund
Allow Younger Workers to Invest In Personal Retirement Accounts
Allow State Employees to Opt Out of Social Security
Gradually Increase Full Retirement Age to Reflect Gains in Life Expectancy
Use Price Growth to Index Benefits for Higher-Income Beneficiaries
FIX MEDICARE AND MEDICAID TO IMPROVE HEALTH CARE
Reform Medicare to be Sustainable for the Long-Term
Return Medicaid Responsibility to States to Increase Health Care Quality and Access
BALANCE THE BUDGET
Cap Federal Spending at 18% of GDP and Balance the Budget by 2020
Reduce Non-Defense Discretionary Spending by $100 Billion in the First Year
Demand a Balanced Budget Amendment that Does Not Raise Taxes
End Baseline Budgeting and Require Common-Sense Scoring Rules
Reform the Budget Process
Institute Automatic Government Shutdown Protection
Give Annual Budget Resolution the Force of Law
No More Earmarks
Require Emergency Spending to be Spent Only on Emergencies
PAYGO for New Federal Programs
Freeze Federal Civilian Hiring and Salaries Until the Budget is Balanced
No More Bailouts
REPEAL JOB-KILLING FEDERAL LAWS
Repeal Obama Care
Repeal Onerous Sarbanes-Oxley Regulations on Small Businesses
Repeal Dodd-Frank
Rick Perry And His Plans For Americans