Rudy Giuliani Unveils Largest Tax Cut in American History
Posted by: Flap in President 2008, Rudy Giuliani
The Giuliani “Fast Form”
Rudy Giuliani unveiled today in Florida a plan to provide the largest tax cut in American history.
The Giuliani tax cut plan would extend the 2001 and 2003 tax cuts immediately; eliminate the Death Tax completely; lower the capital gains and dividends tax rate to 10% and index capital gains to inflation; lower the corporate tax rate from 35% to 25%; and permanently index the Alternative Minimum Tax to inflation with a plan for eventual elimination.
The Giuliani tax cut plan also contains a particularly bold pro-growth tax simplification strategy that would give taxpayers the option of opting into a simple tax plan in which their taxes could be done on one page. Instead of the current tax behemoth, the voluntary tax plan would constitute across the board cuts in marginal tax rates by proposing three simple rates of 10%, 15%, and 30%.
Flap doesn’t know if this is the largest tax cut in the history of America but it does make it simpler, retains progessivity and allows Americans to keep more of their hard earned cash. It is a bold innovative plan that coupled with cuts in federal spending will be growth inducing.
Flap understands that Rudy will have a sample “Fast Form” at his web site: JoinRudy2008.com soon where the taxpayer can enter their own numbers to estimate their taxes under this plan.
More later…..
Update:
A letter from Grover Norquist of the Americans for Tax Reform:
Entries (RSS)
January 9th, 2008 at 3:00 pm
Child tax credit has to be deducted from the “Subtotal Taxes Due”. Otherwise it would cause a large tax increase for the poor and middle class. They need to correct this soon because it looks kind of careless and unimpressive.
January 9th, 2008 at 3:36 pm
Believe me I am no tax accountant. But, the child care credit presently is not refundable except partially in a few circumstances (from what I can research).
On my last year’s 1040 the child care credit is in the same place.
It is not like the Earned Income Tax Credit – EITC or other refundable credits which would go after “Subtotal Taxes due.”
If you know better than let me know.
January 9th, 2008 at 4:57 pm
Flap,
It’s not “child care credit”; it’s “child tax credit”. Look at 1040 line 52
http://www.irs.gov/pub/irs-pdf/f1040.pdf
It is not refundable, but it reduces the tax liability dollar by dollar, up to $0 tax, instead of just reducing the taxable income (which can mean up to 10 times the difference). According to FAST form, this credit will reduce only the taxable income, not the actual tax.
January 9th, 2008 at 5:09 pm
Yeah, sorry I got the name wrong. My children are grown and it is line 53 for me. But either (line 48) child care and child tax credit (line 53) are taken currently after taxable income is determined.
The FAST form is an option anyway as I undertand it. If the taxpayer wants they can file conventionally if it works out better for them.
But, I am a dentist not an accountant and obviously will not use the FAST form.
But, how does it really affect low or middle income folks if they have low or no income anyway?
Can you explain the scenarios?
January 9th, 2008 at 5:34 pm
Family of 4. Each spouse makes 35500. Renters, for simplicity.
Scenario 1 (FAST form as stated above)
71000
-15000 health insurance exemption
-14000 personal exemptions
-2000 child tax “exemption”
40000 taxable income
4000 tax due
Scenario 2 (if credit is really credit)
71000
-15000 health insur exemption
-14000 personal exemptions
42000 taxable income
4300 tax
-2000 child tax “credit”
2300 tax due
So, we are talking about 74% higher tax of scenario 1, compared to scenario 2.
My real point was, though, that it was an overlook on the form. I am pretty sure they meant to propose scenario 2 rather than scenario 1. If you can somehow alert team Rudy, please do.
January 9th, 2008 at 6:20 pm
Yes, there is a difference but I believe in the FAST form they are allowing a tax deduction per child but it is called a child tax credit – just like on the 1040 today.
I know these terms are confusing and that is why I have an accountant.
I’ll see what I can do to drum up an answer for you.
January 9th, 2008 at 6:29 pm
Thanks.
January 9th, 2008 at 6:30 pm
Thanks. I appreciate your time and efforts in keeping this site up. Go Rudy!!
January 9th, 2008 at 7:09 pm
[...] The interactive FAST (Fair and Simple Tax) Form that Flap promised is here. Go check it out…… Pat Toomey of the Club for Growth has praised the plan: “Giuliani’s tax cut plan will encourage capital formation, and capital is the key driver of productivity, higher wages, and a better standard of living for all Americans,” Mr. Toomey continued. “He does that by not only lowering the capital gains and dividends rates, but also by indexing capital gains to inflation. Also, the Mayor’s plan dramatically lowers marginal tax rates at the personal and corporate level, which will encourage a significant burst of economic activity and growth.” [...]
January 10th, 2008 at 3:09 pm
[...] Flap had this post yesterday with the original Giuliani “Fast Form.” Flapsblog Commenter a ng correctly identified an error and it has since been corrected. [...]