Report: Cruz’s tax plan to cost $8.6T, benefit wealthy

Republican presidential candidate and Texas Sen. Ted Cruz’s tax proposals, which feature reduced taxes for most people and the replacement of the corporate income tax with a flat 16 percent business tax, would benefit wealthy taxpayers “dramatically” and reduce federal revenue by $8.6 trillion over a decade.

That’s according to a review from Washington, D.C.-based Tax Policy Center, which also noted the policies would likely depress the economy over the long haul, Bloomberg Politics reports.

In addition to helping the wealthy, taxes could go up for some people in the bottom fifth of low-income taxpayers.

Moving more to a consumption-tax system, which economists say could spur growth from eliminating barriers to saving, working and investing, the plan meets challenges if interest rates rise and Congress fails to enact extraordinarily large cuts in government spending or future tax increases. With the plan in place and no spending cuts or future tax hikes, the policies would create persistently large and likely unsustainable budget deficits, according to the Tax Policy Center.

Read more from Bloomberg Politics.