Rand Paul's proposal of Economic Freedom Zones for reduced taxes and regulations where unemployment is 150% of the national average

Rand Paul proposed legislation creating what he calls Economic Freedom Zones which would see federal income and corporate taxes cut to 5%, and federal payroll taxes reduced to 2% for employers and employees. This would be for areas like Detroit. He proposes reducing federal taxes and regulations in zip codes with unemployment greater than 1 ½ times the national average.

This is a variation of the Special Economic Development zones that worked well in lifting the Chinese economy.

Six pages detail more specifics.

Eligibility:
Eligible areas of the country, whether a city , county, or even zip code, may have the opportunity
to utilize the provisions of this plan for a period of 10 years, starting from the date of eligibility.
1. Any city, county, or municipality that has officially entered Chapter 9 bankruptcy proceedings,
2. Any city, county, or municipality that is “at risk” of bankruptcy or financial insolvency,
3. Any city, county, or municipality that meets an economic threshold of 1.5 times the national unemployment rate, or:
a. At least 30 percent of the residents have incomes below the national poverty level; or
b. 70 percent of the residents have incomes below 80 percent of the median income of the local government.
4. Any city, county, or municipality located in a state deemed “high poverty” and that meets an economic threshold of 1.25 times the national unemployment rate, or:
a. At least 25 percent of the residents have incomes below the national poverty level; or
b. 65 percent of the residents have incomes below 80 percent of the median income of the local government.

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