Twelve reasons to like Jeb’s tax plan
Jeb Bush has released a tax plan. Here are some elements of it that I find attractive:
Here is an assessment of the plan by John Cogan, Martin Feldstein, Glenn Hubbard, and Kevin Warsh.
- It lowers the top rate on personal income to 28
percent, the same rate as the bipartisan 1986 tax reform.
It broadens the base by capping the use of itemized
It eliminates the deductibility of state and
local taxes, so low-tax states and towns no longer subsidize high-tax ones.
It maintains the deductibility of charitable
giving, encouraging private solutions to social problems.
It reforms the tax treatment of secondary earners
and seniors, who are more responsive to tax incentives than primary earners.
It eliminates the stealth marginal tax rates
from PEP and Pease.
It eliminates the estate tax, so the tax system
no longer penalizes those who want to help their children and grandchildren.
It lowers the corporate tax rate to be close to
It moves from a global to a territorial tax
system, like most other nations have.
It eliminates the deductibility of interest
expenses, putting debt finance and equity finance on a more level planning
It includes full expensing of investment
expenditure, moving the system toward a consumption-based tax.
It expands the earned income tax credit for
childless taxpayers, strengthening the social safety net.