Huntsman hits a homerun with tax reform plan

Jon Huntsman, former Governor of Utah and Ambassador to China, unveiled a sweeping, pro-growth tax reform plan yesterday. James Pethokoukis has the details:

Huntsman says he would do the following:

1) Eliminate all deductions and credits in favor of three drastically lower rates of 8%, 14% and 23%.

2) Eliminate the Alternative Minimum Tax.

3) Eliminate taxes on capital gains and dividends in order to eliminate the double taxation on investment.

4) Reduce the corporate rate from 35% To 25%. Huntsman would also shift to a territorial tax system and implement a tax holiday for the repatriation of foreign earnings.

Basically, this is the “zero option” Bowles-Simpson tax plan that lowers marginal tax rates and broadens the tax base. But there is at least one big difference. B-S would use part of the money from axing some $1 trillion in annual tax breaks to lower marginal rates and part for deficit reduction – a net tax hike. Huntsman would divert that extra tax revenue into “paying for” the elimination of investment taxes.

At first glance, this looks like perhaps the most pro-growth, pro-market (and anti-crony capitalist) tax plan put forward by a major U.S. president candidate since Ronald Reagan in 1980. But it is not without political risk. In addition to killing tax breaks for businesses, Huntsman would eliminate the mortgage interest deduction, healthcare exclusion, and the child tax credit among other “tax expenditures. ” We’re talking about a whole herd of sacred cows. Both his fellow presidential candidates and Washington lobbyists will likely attack him for some of those ideas.

Pethokoukis discussed the plan with Huntsman yesterday, which is definitely worth a read. Huntsman, who is in the cellar in polling in race for the GOP presidential nomination, also has an overview of the plan on his site, and I’ve embedded the PDF of it below. Overall, this is the best - or at least the most specific - tax plan I’ve seen from a GOP candidate during this campaign.

Jon Huntsman’s tax plan: “Time to Compete”


The views and opinions expressed by individual authors are not necessarily those of other authors, advertisers, developers or editors at United Liberty.