As his candidacy for the GOP nomination gains momentum, Herman Cain's '9-9-9' tax proposal is coming under increasing scrutiny and fire. Tuesday, Rep. Ron Paul joined the growing list of skeptics in denouncing the plan.
In an interview with CNN, Congressman Paul spoke out against '9-9-9' as "very dangerous," insisting that it is a "regressive" tax, meaning low-income wage earners will pay a higher percentage of their wages in taxes than high-income wage earners.
A recent study by the non-partisan Tax Policy Center supports this, concluding that under Cain's proposal, those making below $30,000 will end up with 16 to 20 percent less money in their pockets after taxes than they currently enjoy, while those making $200,000 and above would keep between 5 to 22 percent more of their money after taxes. The study estimates that 84 percent of Americans would end up paying more in taxes under '9-9-9.'
Under the current tax system, roughly 45 percent of Americans end up owing no federal income tax.
Cain's '9-9-9' proposal would largely replace the current tax code with a 9 percent business flat tax and a 9 percent individual flat tax. The third '9' in the plan is the creation of a new national sales tax of 9 percent.
The danger, as Paul and others contend, is in the creation of a new revenue stream for the federal government, which could lend itself to abuse and the ever-present possibility of those '9' percents being raised higher and higher over time.
History shows the concerns to be well justified. In 1913, after ratifying the 16th Amendment, Congress implemented a one percent tax on individual income exceeding $3,000. The federal income tax rate has climbed substantially since its meager introduction.
Rep. Paul didn't pass up the opportunity to tie in Cain's tax ideas with his past as Chairman of the Federal Reserve Bank of Kansas City:
"What worries me is, he's had a lot of political experience, because he's been in the Federal Reserve System and you cannot do that without being very political....He's part of that banking establishment, and no wonder because he defended the bailouts and TARP funds and all this...."
Despite the attacks, Cain is performing very well in the most recent polls.
The latest Reuters/Ipsos poll shows Cain in second place behind Romney, six points ahead of Congressman Paul who took third place.
The most recent NBC News/Wall Street Journal poll has Cain as the front-runner and Paul in fourth, with Romney and Perry filling out second and third, respectively.
Earlier in the week, Rep. Paul put forward his own plan which would cut one trillion dollars in federal spending in his first year as president, eliminate five cabinet departments, and balance the budget by his third year as president.