'Simplicity is big key' to Senate candidate Smith's tax plan
U.S. Senate candidate Tom Smith released a five-point economic plan that would flatten tax rates, partially privatize Social Security and Medicare, and limit federal regulators.
Smith, an Armstrong County Republican running against Democratic Sen. Bob Casey Jr., said Thursday he would eliminate estate and capital gains taxes to simplify the tax code but would keep popular deductions such as those for college tuition and mortgage interest. He spoke to reporters on his campaign bus in the parking lot of Climatech Inc., a heating, ventilation and air-conditioning company in Kennedy.
“If you make $200,000, you're going to pay the same percentage as somebody who makes $100,000,” Smith said. “Simplicity is the big key.”
Opponents of tax proposals such as Smith's say the flat tax lowers rates on the wealthy by shifting more of the burden onto middle-income earners and that eliminating capital gains taxes allows those who get most of their income from investments to escape income taxes entirely.
“Tom Smith's Tea Party agenda would dismantle Medicare, privatize Social Security and raise the retirement age while giving huge tax breaks to the wealthiest Americans. It is wrong for the middle class, wrong for seniors and too extreme for Pennsylvania,” said Larry Smar, spokesman for Casey, D-Scranton.
Smith accused Casey of not offering his own economic solutions.
“I have never once heard him come forward with a plan,” Smith said.
Casey, Smar said, “helped pass a payroll tax cut that put money in the pockets of working families, and he helped to pass legislation that would stop China from cheating and hurting Pennsylvania workers.”
Smith said he doesn't know what the flat tax rate should be but wants it to be revenue-neutral and wants to cap federal spending at 20 percent of the nation's gross domestic product. Spending was the equivalent of 24.1 percent of GDP in 2011, according to the White House Office of Management and Budget.
Smith also wants to allow people below a certain age — he suggested 55 — to pay into private Social Security accounts. Smith said he would allow people to choose a private insurance option over Medicare as well.
“Let's have an adult conversation about this. This is important,” Smith said. “Let's find the middle ground.”
Mike Wereschagin is a staff writer for Trib Total Media. He can be reached at 412-320-7900 or email@example.com.