This post was originally published on Forbes Oct 12, 2015
Another week another candidate tax plan. This time it is Bobby Jindal. Frankly I didn't know very much about Governor Jindal. It's Louisiana he is governor of, by the way, although you probably already knew that. The one fun fact about Governor Jindal that has me rooting for him purely on entertainment grounds is this:
Prior to immigrating to the United States, both his parents were lecturers at an Indian engineering college. At the time of their move to the US, Raj Jindal was to be a doctoral candidate in physics. They left Malerkotla, Punjab, India] in January 1971; six months before their son was born.
Under Jindal's plan, the Earned Income Credit will be "transferred over to the payroll tax" and administered by employers. Now one of the things that made EIC fraud work was that the EIC rate is higher than the self-employment tax rate, so that by pretending to have an extra $10,000 in income from hairdressing or dog walking or whatever else might sound plausible, you could come out ahead. Not clear how his plan addresses that. If it is by making it so the credit is lower than the SE rate, that would significantly fray the social safety net.
President Obama has nearly doubled our national debt. It is now over $18 trillion and is the largest debt in the history of the world.
Governor Jindal’s plan neuters the IRS, ending the “gotcha game” of tax code compliance and getting Washington out of our wallets. At four million words, it’s no wonder average people get trapped in a web of confusing regulations that read like an instructional manual for your life and your money: buy an electric car, don’t save money to give to your children, only one spouse should work. Let’s stop spending billions of taxpayer dollars to collect taxpayer dollars so that the IRS can make decisions with your money for you.