REPUBLICANS AND TAXES
January 18, 2008
With Democrats insisting on a giant tax increase, taxes will be a major issue this fall no matter who wins the GOP nod. This is a perfect storm that means the next president will have no choice but to make taxes a political priority, says the Wall Street Journal.
So how do the Republican candidates stand on this issue?
First up is Rudy Giuliani:
- The former New York City mayor wants to cut the corporate income tax rate to 25 percent from 35 percent, bringing that rate close to the average of our major trading partners.
- He would chop the capital gains rate to 10 percent from 15 percent, and allow capital gains to be indexed for inflation.
- He'd also index the Alternative Minimum Tax (AMT) for inflation, and create a one-page, 11-line tax return that would eliminate most deductions and tax credits and install three lower rates of 10 percent, 15 percent and 30 percent.
As for John McCain:
- He would cut the corporate rate to 25 percent, and provide immediate expensing for new equipment.
- He would also replace the R&D tax credit that expires annually with a credit equal to 10 percent of wages spent on R&D; and eliminate the hated AMT.
And the others:
- Mitt Romney proposes to expand tax free savings accounts and he speaks vaguely of cutting tax rates.
- Mike Huckabee is the most unusual, combining an anti-corporate message with the most radical reform of all -- the so-called FairTax, or a 30 percent national sales tax that would replace all federal income and payroll taxes.
Source: Editorial, "Republicans and Taxes," Wall Street Journal, January 17, 2008.
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