By Phil Hirschkorn/CNN
November 9, 1999
Web posted at: 6:24 p.m. EST (2324 GMT)
NEW YORK (CNN) — Billionaire businessman Donald Trump has a plan to pay off the national debt, grant a middle class a tax cut, and keep Social Security afloat: tax rich people like himself.
Trump, a prospective candidate for the Reform Party presidential nomination, is proposing a one-time «net worth tax» on individuals and trusts worth $10 million or more.
By Trump’s calculations, his proposed 14.25 percent levy on such net worth would raise $5.7 trillion and wipe out the debt in one full swoop.
The U.S. national debt decreased by $9.7 billion in September but remains at $5.66 trillion, according to the latest U.S. Treasury figures.
The net worth tax is the cornerstone of Trump’s economic plan released Tuesday morning.
«No one has put forward a plan to make this country entirely debt free as we enter the next millenium,» Trump said in a written statement.
«The plan I am proposing today does not involve smoke and mirrors, phony numbers, financial gimmicks, or the usual economic chicanery you usually find in Disneyland-on-the-Potomac,» Trump said.
Trump would exempt the value of an individual’s principal home from the net worth total.
«By my calculations, 1 percent of Americans, who control 90 percent of the wealth in this country, would be affected by my plan,» Trump said.
«The other 99 percent of the people would get deep reductions in their federal income taxes,» he said.
Eliminating the national debt would save the federal government $200 billion a year in interest payments, Trump said. He proposes to earmark half the savings for middle class tax cuts, and the other half for Social Security.
Trump said depositing $100 billion annually in the Social Security trust fund would generate $3 trillion «over the next 30-years, when the trust fund is scheduled to go broke» and instead keep the fund «solvent through the next century.»
The tax also would lead to the repeal the current federal inheritance tax «which really hurts farmers and small businessman and women more than anything else,» Trump said.
Trump, whose own net worth is an estimated $5 billion, says the wealthy would not suffer if his economic plan were enacted.
«Personally this plan would cost me hundreds of millions of dollars, but in all honesty, it’s worth it,» Trump said.
Trump predicts his debt elimination combined with his tax cuts would trigger a 35 to 40 percent boost in economic activity, with more business start-ups, more jobs, and more prosperity.
«It is a win-win for the American people, an idea no conventional politician would have the guts to put forward,» Trump said.
Last month, Trump formed a committee to explore seeking the presidential nomination of the Reform Party, which will automatically be on the ballot in 21 states next year.