Foundation

Rick Santorum Previews His Flat Tax Plan

by Demian Brady / /

Rick Santorum has vowed to "end the IRS as we know it" and will soon unveil his plan to make that so. While the full details are forthcoming, he provided an overview to an audience in Iowa. The current seven federal income tax brackets would be simplified, and the corporate tax rate would be reduced.

  • He would set a 20 percent flat rate on personal, corporate, capital gains and other income.
  • But he also said, "No one in America is going to pay more taxes than they're paying right now." His plan also includes a "prebate" tax credit up to $3,000 per taxpayer. (The Fair Tax reform proposal to replace the income tax with a national sales tax has a similar prebate).
  • The plan would eliminate deductions of state and local taxes, but certain existing tax breaks would be retained, including the deductions for home mortgage interest and charitable donations.
  • Estate and inheritance taxes would also be repealed.

The reduction of the corporate tax rate from 35 percent to 20 percent is similar to Jeb Bush's recently announced tax reform proposal, which the Tax Foundation projected would lead to economic growth.

 Additional information and analysis on the issues the race for the White House is available on our campaign hub page.


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