Reuters blogger and WEEKLY STANDARD contributor James Pethokoukis takes a look at Jon Huntsman's recently unveiled tax plan, and by golly, it might be the first thing about his candidacy that generates real excitement:
I think it is excellent. Huntsman says he would do the following:
1) Eliminate all deductions and credits in favor of three drastically lower rates of 8%, 14% and 23%.
2) Eliminate the Alternative Minimum Tax.
3) Eliminate taxes on capital gains and dividends in order to eliminate the double taxation on investment.
4) Reduce the corporate rate from 35% To 25%. Huntsman would also shift to a territorial tax system and implement a tax holiday for the repatriation of foreign earnings. ...
At first glance, this looks like perhaps the most pro-growth, pro-market (and anti-crony capitalist) tax plan put forward by a major U.S. president candidate since Ronald Reagan in 1980. But it is not without political risk. In addition to killing tax breaks for businesses, Huntsman would eliminate the mortgage interest deduction, healthcare exclusion, and the child tax credit among other “tax expenditures. ” We’re talking about a whole herd of sacred cows. Both his fellow presidential candidates and Washington lobbyists will likely attack him for some of those ideas.
As Pethokoukis notes, it might not be the most politically saleable plan in some respects, but as a matter of policy and principle this is pretty good proposal. Is it time for a reevaluation of Huntsman? If he's got any other policies this good rattling around in the closet at campaign headquarters, now is probably the time to start rolling them out.
UPDATE -- Ramesh Ponnuru has a decidely less positive take on the Huntsman tax plan:
But here’s the problem. The tax code, when combined with entitlements as now structured, overtaxes parents, and the child credit only partially offsets that effect. By abolishing the credit–a legacy of the Gingrich Congress and the Bush administration–Huntsman would be taking a step away from neutrality and toward a perverse form of social engineering.
And while we don’t know all the details it seems highly likely that the net result would be a higher tax bill for most middle-class parents, also known as Republican voters. Attacking the financial interests of your own side’s voters is praiseworthy only if it is in the service of good policy.