“The plan starts with giving Americans a choice between a new, flat tax rate of 20 percent or their current income tax rate,” Perry writes. “The new flat tax preserves mortgage interest, charitable and state and local tax exemptions for families earning less than $500,000 annually, and it increases the standard deduction to $12,500 for individuals and dependents.”
The plan also drops the corporate tax rate to 20 percent and will temporarily lower the rate to 5.25 percent to promote companies working overseas to move to the U.S. along with implementing a “territorial tax system,” which will tax in-country income.
The plan will eliminate the death tax and end taxes on Social Security, which would help an estimated 17 million Americans receiving benefits today. It would also cut taxes on qualified dividends and long-term capital gains.
Perry sets a goal to balance the budget by 2020 by capping federal spending at 18 percent of GDP, banning earmarks and future bailouts and passing a balanced budget amendment.
Until the budget is balanced, Perry’s plan would freeze federal civilian hiring and spending, and place a moratorium on all pending federal regulations, along with auditing any regulations, instituted since 2008.
Perry promises the repeal of President Obama’s health care plan, Dodd-Frank and Sarbonnes Oxley.
On entitlement reform, Perry says his plan will stop the “raiding” of the Social Security Trust Fund and allow younger generations to set up personal retirement accounts.