This is the Cato Daily Podcast for Wednesday, December 12, 2007. I'm Caleb Brown.

Presidential candidate Fred Thompson is out with a tax plan.

Chris Edwards, the Cato Institute's Director of Tax Policy Studies, says the Thompson plan looks a lot like something he recommended just a few years ago.

Thompson would would continue all the Bush tax cuts after they expire in 2010.

He would repeal the alternative minimum tax.

He would repeal the death tax.

He would drop the corporate tax rate. and he would do a major reform of the individual

income tax.

Specifically on the income tax, he's offering what he's describing, and lots of people are

describing, as a voluntary flat tax.

What are the attributes of that?

Well Thompson has taken his idea for what's being called a simplified tax from House Republicans under Congressman Paul Ryan

who've introduced a two-rate tax plan. They would scrap the current income tax code and put in a new tax code with just two simple

rates ten and twenty five percent and they would eliminate virtually every

deduction and credit in the tax code and and Thompson to his credit has grabbed hold of this plan and is

running with it and it's the best tax plan of all the candidates. What's

interesting from a Cato perspective is is that I introduced a very similar two-rate plan back in

2005 when the president was running a tax reform commission and the House

Republicans partly picked up on my tax plan when they

came when they introduced their two-rate plan and so you know it's a good example of

how you can introduce some some serious tax reform ideas and and ultimately we'll get to a presidential

candidate. Now one of the provisions of his tax plan is that those who accept

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