Carson’s tax plan would cost trillions, groups say

Carson’s tax plan would cost trillions, groups say
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The flat-tax plan from GOP presidential candidate Ben Carson would cost trillions of dollars over the next 10 years, two tax groups said on Wednesday.

The liberal Citizens for Tax Justice (CTJ) said Carson’s proposal would cost $9.6 trillion over 10 years on a static basis, meaning the number doesn’t take into account the economic growth the tax cuts would produce. 

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Separately, an analysis from the free-market Tax Foundation found that Carson's plan would cost $5.6 trillion over 10 years on a static basis but only $2.5 trillion when accounting for economic growth.

Carson's plan, released Monday, would impose a 14.9 percent tax on both individual and corporate income, eliminate capital gains and estate taxes and do away with deductions and other tax breaks.

"My flat tax plan has the power to rekindle our nation’s founding ideals by eliminating the needless complexity and treating every American, rich and poor, with or without lobbyists or lawyers, equal in their ability to achieve the American Dream," Carson said in a document detailing his plan.

Both CTJ and the Tax Foundation said that Carson's plan would increase the taxes of low-income taxpayers on a static basis.

According to CTJ's report, two-thirds of the tax cuts in Carson's proposal would go to the top 1 percent of taxpayers, which "reflects the plan’s extremely regressive features." 

The bottom 20 percent of taxpayers would receive an average annual tax increase of $792 and the second 20 percent would get an increase of $447. The primary reason for the increase is that Carson's plan would do away with the earned income tax credit and the child tax credit, CTJ said.

CTJ also added that for most Americans, the marginal tax rate on wages would actually be 30.2 percent, rather than 14.9 percent, because Carson would retain the 15.3 percent payroll tax rate.

The Tax Foundation said that without accounting for economic growth, Carson's plan would increases taxes on all income groups other than the top 10 percent. After accounting for economic growth, all taxpayers would see in an increase in their after-tax incomes in the long run, though higher-income taxpayers would see the greatest increase.

The foundation also said that Carson's plan would lead to a 16 percent increase in gross domestic product in the long run, as well as 10.9 percent higher wages and an increase of about 5.2 million full-time jobs.

Both CTJ and the Tax Foundation estimate that Carson's tax plan would cost more than the tax plan from former Florida Gov. Jeb Bush but less than the proposal from Donald TrumpDonald John TrumpHannity urges Trump not to fire 'anybody' after Rosenstein report Ben Carson appears to tie allegation against Kavanaugh to socialist plot Five takeaways from Cruz, O'Rourke's fiery first debate MORE.