Sen. Rand Paul to Unveil 14.5 Percent Flat Tax for All

Kentucky Sen. Rand Paul outlined some of the highlights of a "fair and flat tax" plan he was to unveil on Capitol Hill later on Thursday, saying that the measure will not only simplify the nation's sprawling tax code, but will allow Americans to keep more of the money they've earned.

"We have a 70,000-page tax code and we're chasing businesses overseas," the Republican lawmaker, also a candidate for the presidency, told Fox News. "We're chasing Burger King to Canada. Every day there's a new company reincorporating somewhere else."

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Paul said his plan would allow a 14.5 percent flat tax for businesses and individuals, while getting rid of payroll taxes for working class Americans.

"This would be the biggest proposal of any candidate so far," Paul told Fox News. "It would be the largest tax reduction in our history. Let's have the debate in our country [about where] money is better spent. Is it better spent by people that earned it or [by] sending it to Washington."

Paul said his plan will also keep the mortgage and charitable deductions, while not allowing any wealthy corporations or people to get away with paying no taxes.

In an opinion piece he wrote for The Wall Street Journal on Wednesday, Paul said President Barack Obama's middle-class economics plan's policies "have led to rising income inequality and negative income gains for families.

"Here’s what I propose for the middle class: The Fair and Flat Tax eliminates payroll taxes, which are seized by the IRS from a worker’s paychecks before a family ever sees the money. This will boost the incentive for employers to hire more workers, and raise after-tax income by at least 15% over 10 years," Paul wrote.

In the column, Paul also said his plan "would blow up the tax code and start over."

He said he's consulted with the Heritage Foundation’s Stephen Moore, former presidential candidate Steve Forbes, who ran and lost on the flat-tax idea, and Reagan economist Arthur Laffer, to come up with a "21st-century tax code that would establish a 14.5% flat-rate tax applied equally to all personal income, including wages, salaries, dividends, capital gains, rents and interest.

"All deductions except for a mortgage and charities would be eliminated."

Further, he said under his plan, "the first $50,000 of income for a family of four would not be taxed," and "for low-income working families, the plan would retain the earned-income tax credit."

Also on Thursday, Paul told Fox of new legislation he's introduced that would arm airline pilots, if they want weapons.

"We've allowed guns in the cockpit for a long time," he said. "I keep meeting pilots when I travel around. They like having guns in the cockpit, but governments make it impossible to do. There's one location in New Mexico you have to give up time to do it."

In April, Paul complained to Fox News' Sean Hannity that Obama has "zeroed" out funding for the Federal Flight Deck Officer program, which allows commercial airline pilots to carry firearms.

"I'm concerned about what is the most cost-effective way of preventing another 9/11," Paul told Hannity on his show. "I want all pilots to be armed."

The Transportation Security Agency, in a follow-up to the 9/11 attacks, developed the Federal Flight Deck Officer program (FFDO) under the Homeland Security Act of 2002, to allow commercial airline pilots to carry firearms. The following year, President George W. Bush expanded the program to include pilots flying cargo planes.

Paul said his goal is "to have 100 percent of American pilots armed because it's the most cost-effective way of deterring another attack on our planes."

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