Republican presidential frontrunner Herman Cain's 9-9-9 tax plan was attacked from all sides on Tuesday, with his fellow candidates panning him during the GOP Debate in Las Vegas and President Barack Obama criticizing the plan on television.
Essentially what it says is that we're going to make sure that the wealthiest among us pay less and we replace any revenues with a sales tax that would be a huge burden on middle class families and working families, Obama told ABC's Nightline.
Similar critiques have boiled forth ever since polls showed Cain leading nominees Mitt Romney and Rick Perry in the race for the Reublican presidential nomination. The 9-9-9 plan, which proposes a 9 percent flat tax on individuals, a 9 percent tax on business and a 9 percent national sales tax, would mean higher taxes for 84 percent of American households, according to CNN Money.
Under the system, which would also eliminate estate and gift taxes, the payroll tax and most tax exemptions, households that have an annual income below $30,000 would lose about 16 to 20 percent of their after-tax income, while families making more than $200,000 a year will see their after-tax income grow.
The overall thrust seems to be if we roll back regulations, and we lower taxes on those who are doing best -- oftentimes by imposing more taxes on middle class and working class families -- that somehow the economy is going to get better, Obama said in the interview.
One of the things I'm most surprised about is hearing both from Republican members of Congress and Republican candidates, the notion that we should return to the rules that existed on Wall Street before the financial crisis. They want to roll back all the Wall Street reforms we put into place as if they've got amnesia about how we got into this problem in the first place, the president added.
The Cain campaign has addressed the class problems inherent in the 9-9-9 plan and says it is trying to ameliorate the burden on low-income families, CNN noted.
The 9-9-9 plan has also been attacked on the right, where politicians and economists feel that a national sales tax spells trouble for the future. Other have said that the simplicity doesn't really paint a complete tax picture.
I think that Herman Cain deserves a lot of credit, candidate Newt Gingrich said in Tuesday's debate. He has had the courage to go out and take a specific very big idea at the right level.
Yet, there are much more complexities than Herman lets on. I mean, 9-9-9, when you get into details, like you pay it on a new product, you don't pay it on an old product, et cetera, there's a lot more detail here than he lets on, he added.
So how did Cain respond to the bullying?
The reason that our plan is being attacked so much is because lobbyists, accountants, politicians, they don't want to throw out the current tax code and put in something that's simple and fair, he said. They want to continue to be able to manipulate the American people with a 10-million-word mess.
We simply remove the hidden taxes that are in goods and services with our plan and replace it with a single rate 9 percent, Cain said cooly. I invite every family to do your own calculations with that arithmetic.