There’s nothing like paying taxes to make American citizens feel (uncomfortably) close to their federal government.
But this year’s deadline for filing federal tax returns is special as it comes in the thick of a historically tight primary race for both the Republican and Democratic nominations for president. And the leading candidates are proposing starkly different visions of how much money the IRS should take in each year.
So, as you prepare to pay your taxes for the 2015 calendar year and begin to choose a candidate for president in the fall, here’s a look at where each of the leading candidates think marginal tax rates should be in the future.
Donald Trump wants to simplify the tax code, reducing the number of tax brackets from today’s seven to just four, while cutting taxes so much that it will add $12 trillion to the national debt over the next 10 years. That’s assuming Trump doesn’t seriously cut back government spending and that economic growth remains at the same pace it has achieved in recent years, according to Tax Foundation estimates.
Ted Cruz takes Trump’s simplification strategy even further. He plans to implement a 10% flat tax on all income above $14,000. To replace some of the lost revenue, Cruz would also institute a 16% value added tax that would raise the cost of products Americans buy, all else being equal.
Among all the leading candidates’ plans, Hillary Clinton’s hews closest to the status quo. She hopes to maintain the basic outline of the current system, while adding an additional tax bracket of 43.6% for taxable wage income over $5 million. Clinton would also raise revenue by limiting the number of deductions wealthy Americans can claim, which would raise the effective tax rate paid by the rich while keeping the marginal rates the same.
Bernie Sanders’ tax code overhaul is nearly as ambitious as some of those on the Republican side, and the increased marginal rates pictured above only tell part of the story. He also hopes to increase payroll taxes to expand Social Security and extend Medicare to every American, while imposing a financial transactions tax to fund free college education for all Americans.
