Team Rudy Responds

I don’t have a link, but the Rudy campaign has issued a response to the flat tax flip flop charge. Basically, the campaign argues that his views have been consistent, because Giuliani’s position on Kudlow the other day was that a flat tax would have been the way to go if we were starting from scratch, but that it’s hard to do so now because the system has already been built around deductions. In 1996, he was arguing against a flat tax because of the immediate impact that the elimination of the state and local tax deduction would have on New York City.

Here’s what he said on Kudlow Monday:

GIULIANI: “I think it needs a massive simplification. If we were doing income tax for the first time, in other words, we were starting off new back at the beginning of the last century, then probably we should go with a–we probably should’ve gone with a flat tax, or maybe two levels of tax, but really simple. Our economy has kind of grown up now on depreciation and deductions and industries have grown up around that, and so I don’t know exactly how much you can simplify it, but you sure have to make a stab at it.

Here’s what he said on his 3/9/96 “Capital Gang” appearance:

GIULIANI: “No, I think it [flat tax] would be a terrible mistake for urban areas, for big states. We depend on the deductibility of state and local taxation and in a time in which the federal government is turning over more responsibility to state and local governments, which they’re doing, whether it’s the Clinton approach or the Republican approach in the House, really it’s just a question of how fast it’s done, you can’t be pulling away some of our economic basis, which rests with state and local taxation and that would be true of any of the big cities, any of the big states. It would really be a disaster and it’s totally inconsistent with the movement of the Republican Congress toward giving more responsibility to state and local government.”