Rand Paul would replace income tax with sales tax

Associated PressOctober 12, 2010 

Rand Paul

FRANKFORT — Republican U.S. Senate candidate Rand Paul said Tuesday the federal tax code is a "disaster," and he wants to replace the income tax with a retail sales tax.

Paul said that he would support changing the federal tax code to get rid of the Internal Revenue Service, and he would vote to repeal the Sixteenth Amendment that created the federal income tax.

"The federal tax code is a disaster no one would come up with if we were starting from scratch," Paul said in a written statement distributed by an anti-tax group and verified by his campaign. "I support making taxes flatter and simpler. I would vote for the FairTax to get rid of the Sixteenth Amendment, the IRS and a lot of the control the federal government exerts over us."

The proposal has been championed by the Texas-based group Americans for Fair Taxation and a newly formed affiliate, FairTax America Support Team. Paul's former campaign manager, David Adams, is a member of the affiliate's governing board.

Paul faces Democrat Jack Conway in one of the most closely watched races in the nation. They're seeking to replace 78-year-old Sen. Jim Bunning who opted not to seek a third term.

University of Kentucky political scientist Stephen Voss said Paul's stand could help him in Kentucky where voters, especially those of the tea party persuasion, are angry about the tax burden.

"It could play well in a state like Kentucky when you show all the things that are not progressive about the current tax system," Voss said. He noted that the issue is ripe for political spin.

Kentucky tea party gubernatorial candidate Phil Moffett predicted Paul's stand will energize his base of support three weeks before Election Day, though it could dissuade others.

"The problem with the FairTax is that it's one of the easiest things to demagogue," said Moffett, who has made a similar state-level proposal a centerpiece of his campaign. "It's an easy way to scare some voters away. But those who would be scared away probably aren't up on the FairTax and likely wouldn't have voted for Rand Paul anyway."

Conway spokeswoman Allison Haley said Tuesday the proposal calls for a tax of nearly a quarter on every dollar.

"Working people are having a tough enough time making ends meet," she said. "They don't need a 23 percent sales tax on everything they buy — from groceries to gas to medicine."

Americans for Fair Taxation wants a so-called "FairTax" that would abolish all federal personal and corporate income taxes as well as gift, estate, capital gains, alternative minimum, Social Security, Medicare, and self-employment taxes. Those taxes would be replaced with a federal retail sales tax administered primarily by existing state sales tax authorities.

Adams said the group is "delighted" to have Paul among the proposal's backers, who include Sen. Jim DeMint of South Carolina. DeMint has come to Kentucky to campaign for Paul.

It's not the first time Paul has called for abolition of a federal agency. On the campaign trail Tuesday, Paul repeated his call for abolishing the U.S. Department of Education.

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