Republican presidential candidate Rick Perry rolled out his economic plan Monday, and it calls for allowing Americans to choose between their existing income tax rate and a new flat tax rate of 20 percent.

Called Cut, Balance and Grow, the plan would also scrap the current tax code, lower and simplify tax rates, cut spending and balance the federal budget, reform entitlements, and grow jobs and economic opportunity.

The Texas governor is formally announcing his plan at a Tuesday event in South Carolina.

My plan restores American competitiveness in the global marketplace and provides strong incentives for U.S.-based employers to build new factories and create thousands of jobs here at home, Perry said in an op-ed column in The Wall Street Journal Monday night.

Perry's proposal comes as his popularity has dipped significantly; he now trails behind fellow candidates Herman Cain and Mitt Romney.

Perry: U.S. Could Become As Mired In Debt As Europe

Without significant change quickly, our nation will go the way of some in Europe; mired in debt and unable to pay our bills, Perry writes. President Obama and many in Washington seem unable or unwilling to tackle these issues, either out of fear of alienating the left or because they want Americans to be dependent on big government.

The flat tax proposed by Perry would preserve key tax exemptions for families earning less than $500,000 a year and would increase the standard deduction to $12,500 for individuals and dependents. It would also eliminate the tax paid on the country's largest estates when property owners die and eliminate taxes on Social Security benefits.

It will be an extremely difficult tax exacerbated by the current economic crisis and our need for significant tax cuts to spur growth, Perry said. But that growth is what will get us to balance, if we are willing to make the hard decisions of cutting.

Unlike Romney's plan, a 59-point jobs plan unveiled in September, Perry's would make markedly dramatic changes. Romney would lower rates on corporations and on savings and investment income for middle-class Americans. Perry's plan also differs from Cain's 9-9-9 plan, which relies mostly on a new national sales tax.

Forbes: Flat Tax Offers Many Advantages

Publisher Steve Forbes, a key supporter of Perry for the 2012 Republican nomination, promised the proposed flat tax will satisfy all corners, Fox News reported.

You have to make a real sum of money before the tax kicks in, Forbes told Fox News. Middle-income people are not going to pay more and they are going to save huge amounts of money.

President Barack Obama'scampaign issued a criticism-laden statement of Perry's plan, saying it is designed to benefit the high-income class at the expense of the middle.

Both the Romney and Perry economic plans embrace a far-right vision for our tax code, wrote James Kvall, policy director for Obama for America. They share elements with plans offered by congressional Republicans, which independent economists believe would fail to accelerate job creation now. Both plans would cut taxes on wealth and investment income, shifting the tax burden onto work and wages. Both plans are likely to be costly, driving up the deficit at a time of historic fiscal challenges. And under both plans, the most fortunate Americans would pay less while the middle class would pay a higher share.