Presidential candidate Ben Carson released a three-page tax plan yesterday. Based on the limited information the plan includes, it looks like the best GOP plan so far.

Individuals and businesses would be subject to a simple 14.9 percent flat tax. The tax base appears to be of the Hall-Rabushka (HR) design, which is the gold standard of simple and pro-growth tax structures. I say “appears to be” because the Carson three-pager gives some hints, but not full details.

The defining feature of HR is that income is taxed once and only once. The current double taxation of savings and investment would be ended. Capital income would be taxed at the business level under HR, while labor income would be taxed at the individual level. Robert Hall and Alvin Rabushka proposed the HR tax structure back in 1981, as I discuss here. Rabushka, by the way, is a Cato adjunct scholar.

Ben Carson seems to have avoided the dangerous business VAT structure of the Ted Cruz and Rand Paul tax plans. He appears to be critiquing Cruz and Paul in this passage:

Unlike proposals advanced by other candidates, my tax plan does not compromise with special interests on deductions or waffle on tax shelters and loopholes.

Nor does it falsely claim to be a flat tax while still deriving the bulk of its revenues through higher business flat taxes that amount to a European-style value-added tax (VAT).

Adding a VAT on top of the income tax would not only impose an immense tax increase on the American people, but also become a burdensome drag on the U.S. economy.

I elaborate on Carson’s concerns about a GOP VAT here. My hope is that Cruz and Paul go back to the drawing board, drop their VATs, and release 2.0 versions of their plans. Carson’s plan appears to show a keener understanding of the big government risks of broadening the business tax base.  

Without details, I don’t know how close the Carson plan is to the HR model. But his three-pager indicates that he plans to abolish just about all special deductions and credits. And I like the fact that he makes both an economic and a moral case for flat and equal taxation on all Americans above a low-income threshold.

With low rates and an apparently neutral tax base, the Carson flat tax would be strongly pro-growth. American businesses would have increased incentives to build factories and buy capital equipment. Domestic production would expand, companies would hire more workers, and wages would be bid up. U.S. companies would become more competitive globally, and multinational corporate headquarters would move back to America.

That is all good news. But Carson and the other candidates should pair their tax-cut plans with spending-cut plans. Without spending cuts, the next president will have a hard time getting tax cuts through Congress because of deficit fears. Besides, both tax cuts and spending cuts stimulate private-sector economic growth.

In sum, kudos to Carson for his strongly pro-growth tax plan, and for apparently avoiding the VAT trap. The next step should be for Carson to provide full details to the modelers at Tax Foundation to examine the plan’s revenue and growth effects.