Bloomberg News

Herman Cain Says 9-9-9 Tax Plan Will End ‘Invisible Taxes’

October 16, 2011

(Updates with Tennessee bus tour from fourth paragraph.)

Oct. 16 (Bloomberg) -- Herman Cain said his proposed 9-9-9 tax overhaul will benefit poorer Americans by eliminating “invisible taxes” that push up the price of goods.

“There are some people who are going to pay more taxes,” said Cain in an interview on NBC’s “Meet the Press” today. Most of those people, he said, will benefit from lower prices caused by greater competition among businesses and fewer taxes being embedded in production costs. “Those taxes go away, so the price of goods won’t go up,” he said.

The plan offered by Cain would replace payroll taxes now embedded in products, reducing prices to offset the new sales tax, along with eliminating capital gains and inheritance taxes, Cain said. The plan reflects his business-oriented, problem- solving approach, he said.

The Sunday talk show appearance capped a week in which Cain surpassed former Massachusetts Governor Mitt Romney at the top of some Republican primary presidential polls. Cain, on a bus tour, appeared at Tea Party-supported events on Oct. 14 and yesterday in five small towns in Tennessee that each attracted more than 500 people. One of the largest gatherings included more than 1,500 people at an exhibition hall in Waverly, a town of about 4,000 people 65 miles west of Nashville.

Ultra Conservative

Retired factory representative Jimmy Stevens of Waverly said he decided Cain was his favorite candidate about three weeks ago. “He is ultra conservative and that’s what I like,” said Stevens, a spokesman for the Humphreys County Tea Party, which helped organize the Oct. 14 event. “We don’t want moderates or Republicans in name only.”

Brian Collins, a courier company owner in Cookeville, spent $50 to attend a Cain breakfast fund-raiser yesterday at a local country club.

“He’s not Washington, and he came up the way most Americans do,” said Collins. “The fact he’s black is a bonus because it shows anyone can succeed if they persevere.” Only a handful of African-Americans attended the Cain events except in Bartlett, where there were several dozen.

Cain said today his remark yesterday in Cookesville that the U.S. should secure its border with Mexico by building a 20- foot, barbed-wire, electrified fence with signs in English and Spanish, saying “it will kill you,” was “a joke.”

Not Serious

“That’s not a serious plan,” he said, adding that an immigration solution will require a combination of a physical fence, better technology, U.S. troops in some areas, less bureaucracy in current immigration processing and more power for states to “do what the federal government can’t do.”

Cain said yesterday he was campaigning in Tennessee because “the whole primary schedule has been tossed aside” with states moving up their election dates. “It makes other states much more important,” he said after speaking to about 1,000 people in the parking lot of a strip shopping center in Jackson, Tennessee.

Referring to the two states that traditionally kick off the nomination process, Cain said he has already been to Iowa “two or three times,” and also made numerous trips to New Hampshire. He plans to spend next weekend in Iowa.

Tennessee’s primary is scheduled for March 6, almost two months after the expected Iowa caucuses on Jan. 3, and more than a month after Florida will hold what may be a decisive primary on Jan. 31.

Cain’s Message

Cain, who reported raising $2.6 million in the third quarter, is gaining in the polls “because of the substance of my message,” he said in the NBC interview.

Texas Governor Rick Perry led the Republican field in fundraising in the third quarter, taking in $17.2 million, Federal Election Commission reports show. Former Massachusetts Governor Mitt Romney raised $14.2 million from July to September and Representative Michele Bachmann, winner of the Iowa straw poll, raised $3.9 million and had $1.3 million in the bank.

President Barack Obama’s campaign has overwhelmed the Republican field financially. He raised $42.1 million from July through September.

Cain will have difficulty convincing people to accept a 9 percent sales tax, especially residents of states such as New Hampshire that have no sales tax, Republican competitor Newt Gingrich today said on CNN’s “State of the Union” program.

“As people look at 9-9-9 and disaggregate it, it gets to be a lot harder sale, I think,” said Gingrich, a former speaker of the U.S. House of Representatives.

Cain has gained in popularly because “Perry stumbled,” Gingrich said. “Perry was the natural alternative to Romney and if Perry had had a flawless campaign, he would have been the nominee. He stumbled enough in the debates that there was a vacuum created.”

--With assistance from Jonathan Salant and Susan Decker in Washington. Editors: Ann Hughey, Kevin Costelloe

To contact the reporters on this story: Alan Bjerga in Washington at abjerga@bloomberg.net David Mildenberg in Harriman, Tennessee at dmildenberg@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net.


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