Alright, I'll try to explain to the best of my ability - bear in mind that I am no economist - I wasn't even a good student in school!
First here is the summery bullet points from Herman Cain's website (
http://www.hermancain.com/h ):
*Unites all tax payers so we all pay income taxes and no one pays payroll taxes
*Provides the least incentive to evade taxes and the fewest opportunities to do so
*Lifts a $430 billion dead-weight burden on the economy due to compliance, enforcement, collection, etc.
*Is fair, neutral, transparent, and efficient
*Ends nearly all deductions and special interest favors
*Ends all payroll taxes
*Ends the Death Tax
*Features zero tax on capital gains and repatriated profits
*Lowest marginal rates on production
*Allows immediate expensing of business investments
*Eliminates double taxation of dividends
*Increases capital formation. Capital per worker drives productivity and wage growth
*Capital formation will aid capital availability for small businesses
*Features a platform to launch properly structured Empowerment Zones to revitalize our inner cities
*We all know the Fed has tripled the money supply since 2008. They have been printing money out of thin air to finance the Obama spending machine. While true Fed reform that restores sound money may have to wait for my election, the best thing we can do now is to pursue policies that increase the DEMAND for dollars to help mitigate the risks associated with the increase in the supply.
*Pro-growth economic policies equal a strong dollar policy
Now as I understand it, the 9-9-9 plan reduces individual and business income tax rates to 9% from as much as 35% currently, while imposing a 9% national sales tax, scrapping all tax breaks and eliminating the payroll tax, the estate tax and capital gains tax. Opponents are trying to say "well, how will you stop someone later from increasing the 9-9-9 plan?" Same question applies to the current IRS code. If congress is full of tax and spend people, nothing is safe.
The 9-9-9 plan will change how taxes are collected - and that will strip power away from the politicians and put it in the hands of the people. See, that is what is the real core of the Progressive's fear of this plan and Herman Cain - it/He takes power AWAY FROM THE GOVERNMENT and GIVES IT BACK TO THE VOTERS.
The democrats live by their stranglehold of power over their constituents through the tyranny of big government. That is illustrated no better than simply looking at the democrat's wet dream for taxation: The VAT. You want to discuss regressive taxation? Look into the VAT!
Ultimately it comes down to this for me. I AM a 100% supporter of the FAIR Tax (I'll provide more information on the FAIRTax in a followup post after this one for those of you that may not know what it is) - so is Herman Cain. According to Herman Cain (in speeches and on his website [see above address]), his 9-9-9 Plan is a vehicle to get us to the FAIR Tax.
From his website:
Phase 1 - 9-9-9
(see above bullet points)
Phase 2 – The Fair Tax
*Amidst a backdrop of the economic boom created by the Phase 1 Enhanced Plan, I will begin the process of educating the American people on the benefits of continuing the next step to the Fair Tax.
*The Fair Tax would ultimately replace individual and corporate income taxes.
*It would make it possible to end the IRS as we know it.
*The Fair Tax makes our exported goods and services the most competitively internationally than any other tax system.
Now, having said all that I need to conclude this post with this thought. I would MUCH rather skip this 9-9-9 plan business altogether and just get right into the FAIR Tax. There is a problem however. The FAIR Tax is exceedingly easy to demonize as an 'regressive tax' by simply dropping some mis-truth's about it...doesn't take a lot of effort and even the dumbest liberal troll can do it. It's been explained by Neal Boortz (read more about him in my followup post) that this middle step on the way to the FAIR Tax is being undertaken in an effort to make it more difficult to demonize by making the change more gradual. If you understand my meaning? The point here is that it seems to me that Cain is attempting to institute the 9-9-9 Plan because it's easier (and more likely) to get it done now than the FAIR Tax and at some point during his presidency, is then planing to transition into the FAIR Tax.
Alright - on to explaining the FAIR Tax...