Perry To Push Flat Tax: ‘I Want To Make The Tax Code So Simple That Even Geithner Can File His Taxes On Time’

He got a bit chippy with Mitt Romney at the GOP debate in Las Vegas last night, laid a pretty good lick on Herman Cain about the difficult viability of the latter’s 9-9-9 tax plan and generally picked up decent reviews for showing more life than he had in previous appearances even if the consensus was that his attack on Romney’s illegal immigrant gardeners wasn’t a great success.

But in a speech in front of the Western Republican Leadership Conference this afternoon, Perry pulled the string on a tax plan of his own which promises to catch quite a bit more support than Cain’s controversial national sales tax has received.

After a feisty debate performance Tuesday night, Texas Gov. Rick Perry jogged on stage Wednesday and offered an audience of GOP activists a preview of the economic plan he will unveil a next week in South Carolina.

“It starts with … scrapping the three million words of the current tax code, starting over with something simple: A flat tax,” he told an audience at the Western Republican Leadership Conference.

For good measure, Perry added a quip at the expense of the Obama administration’s Treasury Secretary. “I want to make the tax code to so simple that even Timothy Geithner can file his taxes on time,” referencing the late tax bills that almost imperiled Geithner’s nomination as Treasury secretary.

The economic address, the second in a series of policy speeches that began last week, is scheduled for next Tuesday in first-in-the-South primary state of South Carolina. Perry said Wednesday that the proposal will also include “a serious commitment to spending cuts” and a Balanced Budget Amendment, as well entitlement reform —  although he offered no specifics about how he would change the latter. He also promised to “end earmarks for good.”

In pushing a flat tax, Perry picked up some kudos from the godfather of the idea, former presidential candidate and economic guru Steve Forbes – who has been linked to the Perry camp for some time and may have sold the Texas governor on a flat tax.

Mr. Forbes was characteristically exuberant on Wednesday.

“I’m very, very excited by it,” Mr. Forbes said in a telephone interview. “What Perry is proposing is a radical simplification of the income tax code….It’s finally coming to pass.”

Mr. Perry officially announced his support for the flat tax in a speech on Wednesday. Mr. Forbes, who ran in 1996 and 2000 and now is advising the Perry camp, said that the “concept remains the same” as his own flat tax plan from the 1990s. That plan included a $36,000 exemption for a family of four and a 17% flat rate on income above that level. It also would have eliminated taxes on personal savings and capital gains in order to encourage investment.

In political terms, the Perry proposal appears to be a response to the popularity of candidate Herman Cain’s own radical “9-9-9” tax plan, which combines a flat tax on businesses and individuals with a national sales tax.

We’d offered up something similar earlier this week, but the chances are that Perry’s getting the idea from Forbes rather than us.

Mr. Forbes – like some other political observers – thinks Mr. Perry’s embrace of the flat tax makes it even more likely that tax reform will become a key issue in the 2012 campaign, particularly for Republicans.

“It’ll be a huge tonic politically and economically and make it a huge issue next year,” he said. “And there will be a big mandate for tax simplification.”

The flat tax idea is frankly much stronger than 9-9-9. With a built-in exemption, it provides insulation from concerns that poor people would get hit with higher taxes under Cain’s program – the Tax Policy Center calculated that some 84 percent of the population would pay more under 9-9-9 than they currently do. But it has the advantage of simplicity and fairness – one thing almost universally despised by the public about the current tax code is that it includes so many subsidies, loopholes and social engineering projects that a perception of a fixed game exists courtesy of lobbyists and crooked politicians. Starting over with something clean like a flat tax, particularly given evidence, as Forbes often suggests, that it has worked in two dozen countries around the world when implemented, has appeal.

In fact, Cain’s 9-9-9 plan has taken him as far as it has for the simple reason that it does contain a low flat tax rate. Perry can sell his plan as having those features people like about 9-9-9 without the dangerous component of a federal sales tax.

That’s a strong program, and it dovetails nicely with Perry’s presentation on energy last week. On policy, he’s putting together an arsenal which can compete with anyone else in the field.

But last night’s probably necessary attention-grabbing hacks aside, Perry is going to have to focus on his own proposals and leave the mud-wrestling with Romney alone. He has a record to run on, and he has excellent ideas to pitch to a party that’s ready for them. Throwing bombs at Romney – who at the end of the day is not an obstacle to Perry earning the nomination – is counterproductive and, frankly, premature. Perry needs to consolidate support as the anti-Romney first, which he can only do by making voters feel like he has the chops to be president, and THEN he can attack Romney. Even then, those attacks are far better performed through TV spots and web ads than they are in a debate format when bomb-throwing among Republicans only makes people uncomfortable.

For the next month there won’t be any presidential debates, and Perry will get an opportunity to pitch his policies without the kinds of distractions he was tempted with last night. The flat tax plan is a good one and it gives him a chance to regain his momentum – if he can stay on message.

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