Marco Rubio’s tax proposal would convert the federal income tax into a consumption tax by not taxing investment income of individuals and by converting the corporate income tax into a cash-flow consumption tax. It would replace most deductions and exemptions with a universal credit; eliminate estate taxes, the AMT, and all ACA taxes; and move the US to a territorial tax system. A new $2,500 child credit would aid families with children. Taxes would fall at all income levels, with high-income households benefiting the most. Revenues would decline by $6.8 trillion over a decade (assuming no change in economic growth).
It is only April and we have heard presidential candidates propose some of the biggest and most ambitious tax plans in modern US history. Donald Trump is proposing the largest tax cut ever, and Ted Cruz is not far behind. Bernie Sanders has proposed the biggest tax increase since World War II.
Last week, House Speaker Paul Ryan said in a CNBC interview that the distributional analysis of tax plans done by the Tax Policy Center, the Joint Committee on Taxation, and others is based on the “ridiculous notion” that the effect of tax changes on different income groups is important.
How do the Republican presidential candidate tax plans stack up against one another? Who has the biggest tax cut? How do their plans affect people in different income groups?
At last night’s GOP debate, Senator Marco Rubio accused Ted Cruz of sneaking a value-added tax (VAT) into his tax reform plan. RUBIO: Here is the one thing I’m not going to do. I’m not going to have something that Ted described in his tax plan. It’s called the value-added tax. And it’s a tax […]
Distributional estimates of Senator Marco Rubio’s tax plan.
Senator Marco Rubio would convert the income tax into a progressive consumption tax, an ambitious idea that would eliminate the income tax’s penalty on saving. However, a new Tax Policy Center analysis finds that Rubio’s version would slash federal tax revenues by $6.8 trillion over the next decade with most of the benefits going to high-income households. Unless Rubio offsets those revenue losses with big spending cuts, he’d lose most if not all of the economic benefit of his plan.
The presidential election is nearly a year away, but many candidates have already rolled out detailed tax reform plans. On the GOP side, we’ve seen proposals from Jeb Bush, Marco Rubio, Ted Cruz, and Donald Trump, among others.
Republican presidential candidate Marco Rubio recently introduced a transportation plan that cuts the federal gas tax 80 percent—from 18.4 cents per gallon to 3.7 cents—and eliminates the Highway Trust Fund’s (HTF) Mass Transit Account.