The political class in Washington had sneered at Jeb Bush’s pledge to put America back on the 4% economic growth path, but on Wednesday he went a long way to showing how to achieve that goal.
The former Florida governor became the latest GOP presidential contender to detail his tax reform vision, and this overhaul would be a big improvement over the monstrosity of a tax code we have now.
Almost everyone in America outside the Obama administration and the 2016 field of Democratic presidential candidates understands the federal IRS tax code is like a gift to our economic competitors. The system — especially our highest-in-the-world corporate tax — exports jobs to rivals such as China and Mexico while reducing work and investment.
Bush’s plan starts by slashing tax rates. He’d return to the top personal income tax rate of 28% that America had when Ronald Reagan left office. That top rate, by the way, was a true bipartisan reform designed in part by congressional Democrats like Bill Bradley and Dick Gephardt. The rate has since migrated up to 42%, with many Democrats longing to tax the rich well above 50%.
Middle-class tax rates would fall to 10% for families with incomes up to $89,000 and to 25% for incomes up to $163,800. For singles, the thresholds are lower. But the thresholds are not high enough to ensure no one in the middle class gets pushed into higher tax brackets.