Bush Tax Cuts:

The Republican candidate for president, John McCain, proposes making the Bush administration’s 2001 and 2003 income tax cuts permanent, according to his campaign Web site. These cuts, which are on track to expire in 2010, have the top income tax rate at 35% and the capital gains and dividends rates at 15%.  He has recently said he'd cut the long term capital gains tax rate to 7.5%.

See candidates' tax plan comparison chart at the bottom.

He said during the presidential debates that to raise taxes on anyone would be a bad move and could push the country into a depression.

McCain said in an ABC interview last April that he opposed the Bush tax cuts in 2001 "because there wasn't spending restraint. If we had done what I wanted to do, we would be talking about more tax cuts today."

In an interview on NBC's Meet the Press in 2004 he said "I voted the against the tax cuts because of the disproportional amount that went to the wealthiest Americans. I would clearly support not extending those tax cuts in order to help address the deficit. But the middle-income tax credits, the families, the child tax credits, the marriage tax credits, all of those I would keep."

Tax Changes:

To benefit larger families, McCain plans to double the personal exemption for dependents from $3,500 to $7,000, according to a Reuters report.

The candidate supports phasing out the Alternative Minimum Tax and cutting the corporate income-tax rate from 35% to 25%, which he says is the second-highest rate in the world. He would also ban Internet taxes. His tax cuts are expected to cost $400 billion a year.

The Arizona senator believes millions can be saved every year by eliminating earmarks, pork barrel spending, and waste.

Like his opponent Barack Obama, McCain has also committed to a “pay-as-you-go” approach to budgeting, offsetting new spending with cuts elsewhere or raising more tax revenue to pay for it.

McCain wants to establish a 10% tax credit for wages spent on R&D.

Tax Reform:

The senator says he would reform the income tax code by offering Americans a choice to file under a system with just two tax rates and a large standard deduction, according to the campaign site.

McCain supports a flat 15% estate tax rate with an individual exemption of $5 million and $10 million for married couples.

Source: Candidate Web Sites / WSJ