There is currently much discussion around Capitol Hill about radically changing the US tax system. However, sweeping changes should be entered into cautiously. We need stability in our tax laws and regulations. Uncertainty harms our economy and
discourages investment.
One plan worth considering is a value-added tax (VAT), which collects a small percentage at each point in the manufacturing process. The VAT does not apply to sales outside the country. An advantage of this tax is that it is
relatively easy to collect, and it encourages our exports, which means more jobs for the US. Another advantage of the VAT is that it taxes consumption rather than savings. There seems to be growing support for a consumption-based tax system. Presumably,
a VAT would partially or substantially replace the income tax.
The disadvantage of the VAT is that it is regressive, but there are ways to compensate for that. The VAT should be closely analyzed in connection with any plan to reform our tax system.
Source: The Dollar Crisis, p.111-112
Jul 2, 1996
Cut spending and raise taxes to pay off debt
According to Perot, the national debt is like the “crazy aunt that nobody in the family talks about.” And there is only one way we can bring this leviathan under control: “We must cut spending and raise taxes to pay our bills.
Perot does not advocate any substantial program cuts. His proposals primarily involve cost-cutting efficiency measures-the elimination of waste, the tightening of expansion, and the identification of spurious entitlement claims.
His plans also rely heavily on increasing both the efficiency and capacity of the tax-gathering agencies in government. By strengthening the IRS, modernizing its computer capabilities, eliminating loopholes, and shoring up enforcement measures.
He believes that much of the federal shortfall can be eliminated.
He admits that his big-government, big-business coalition would require additional tax revenues. Thus he would have a stronger and more efficient IRS.
Source: Strong-Man Politics, by George Grant, p.106-7
Nov 7, 1992
Raise marginal tax rates on the wealthy
We should raise the marginal tax rate on the wealthy from 31% to 33%. In 1993, this change would affect individuals who make over $55,550 and joint filers who make over a total of $89,250. Therefore, less than 4% of the taxpayers in America will be
affected, but we will raise $33 billion in five years. If other reductions I propose do not provide sufficient revenue, we should be prepared to raise the marginal rate to 35%.
Source: United We Stand, by Ross Perot, p. 43
Jul 2, 1992
Disallow mortgage & health deductions for the rich
Why should we subsidize interest on huge, expensive homes? The average mortgage in the US is $104,000. I propose that we limit deductions on interest to mortgages of $250,000 and that we eliminate this special deduction for vacation homes.
Another subsidy for the rich is the exemption from taxes on expensive employer-paid health insurance. These plans support the rich and encourage excessive health costs. They should be taxed as additional income.
Source: United We Stand, by Ross Perot, p. 42-43
Jul 2, 1992
Decrease capital gains tax to foster long-term thinking
The policies have already been proposed that can reverse our slide and get the economy moving for the long term:
Investment tax credits. We can stimulate growth by providing tax credits to companies that buy productive
equipment and machinery.
Research and development tax credits. We need to encourage our companies to put their money into new improvements, new products, and new lines of products.
Tax breaks for long-term capital gains.
If shareholders aren’t squawking for a short-term gain, the company can concentrate on improving its product so it can survive, compete, and grow. We need a stair-stepped capital gains tax, decreasing each year over five years,
on shares purchased from public companies with the money going into the treasury to build the company. This would provide the proper incentives to industry and to the market.
Source: United We Stand, by Ross Perot, p. 66-68
Jul 2, 1992
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