Prior to the Iowa caucus, only the most ardent of supporters would describe Republican presidential candidate Rick Santorum as anything other than a long shot. But then Iowans placed him within a thin whisker (8 votes actually) behind Mitt Romney in the final standings and suddenly everybody is interested to find out exactly what the man favors in the arena of fiscal policy. It turns out that Santorum has a few specific ideas to tweak and simplify the tax code. In case you find yourself in the majority of people who are aware of the man simply as a place holder on the far side of the debate stage, here are some specifics.
While no one is preparing to have this former senator from Pennsylvania recite the presidential oath of office just yet, it's certainly worth hearing what Santorum has to say.
Tax Brackets
How many tax brackets do we currently have in the United States? Does anyone even know? One thing's for sure; there are many more than the two that Santorum proposes we adopt. The first would be set at 10% and the second at 28%. Add in an approximate tripling of the personal deduction parents
9; can claim for children and you have the beginnings of a tax reformation lots of people would like.
Corporate Tax
Operating under the belief that current tax law stifles free enterprise, Santorum proposes the corporate tax rate be cut in half, bringing it down to around 17.5%. Additionally, he would eliminate the tax entirely for manufacturers, increase research and development credits and reduce the penalties for businesses choosing to bring overseas profits back home and put them to work in the American economy.
Etc.
Along with the tax adjustments just mentioned, Rick Santorum would lower the capital gains tax from 15% to 12%, reduce the so-called “marriage penalty” which makes it financially smarter for some couples to file individually, and eliminate the estate and Alternative Minimum Tax.
On the surface, all these sound good to fiscal conservatives, though with his recent leap into the limelight, Santorum's plan is only now beginning to receive more intense scrutiny. On an initial read, some claim it would reduce the number of households currently paying income tax and add trillions to the federal deficit. What say you Mr. Santorum?
The American Monetary Association Team
Flickr / Gage Skidmore