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Romney Would Raise Taxes on Poor, Middle Class

Romney Would Raise Taxes on Poor, Middle Class

Mitt Romney’s tax plan would raise taxes on all but the top 5 percent of earners, according to an analysis by the non-partisan Tax Policy Center.

“Our major conclusion is that any revenue-neutral individual income tax change that incorporates the features Governor Romney has proposed would provide large tax cuts to high-income households, and increase the tax burdens on middle- and/or lower-income taxpayers,” the report said.

According to the report, Romney’s insistence on “revenue-neutral” tax cuts, in addition to his stated goal of cutting tax rates while eliminating deductions, would inevitably lead to significant tax cuts for wealthy Americans, which necessitate tax increases for the vast majority of Americans.

The report said that the results held under any analysis of possible options, even ones in which deductions that favor the wealthy, were eliminated before any other cuts and deductions were put into place.

“Even when we assume that tax breaks – like the charitable deduction, mortgage interest deduction, and the exclusion for health insurance – are completely eliminated for higher-income households first, and only then reduced as necessary for other households to achieve overall revenue-neutrality — the net effect of the plan would be a tax cut for high-income households coupled with a tax increase for middle-income households,” the report said.

The Romney campaign dismissed the report out of hand.

“That report you referenced is a joke,” said Eric Fehrnstrom, a senior adviser to Romney, according to Politicker. “It was co-authored by a member of the Obama White House, someone who was part of the White House economic team. And the study doesn’t take into account important aspects of Governor Romney’s plan which will have a positive, pro-growth impact on the economy.”

The report was co-authored by Adam Looney, who worked as a staff economist for the Council of Economic Advisers from 2009 to 2010. Another co-author of the report, however, was William Gale, who was a staff economist for the Council of Economic Advisers under President George H.W. Bush. The Tax Policy Center itself is directed by Donald Marron, who served on the Council of Economic Advisers under President George W. Bush.

The Tax Policy Institute anticipated the Romney campaign’s other objection, that the changes in tax policy would spur significant economic growth which would change the calculus of the study.

“[E]stimates indicate that the effects of tax rate reductions on the macroeconomy are likely to be small or even negative, at least, over the typical 10-year budget window,” the report said. “At the end of the day, the net effects on labor supply and saving behavior would likely be small.”

The report is a serious blow to Romney, who has painted himself as more of a tax-cutter than President Barack Obama. In responding to the report, Fehrnstrom claimed that “President Obama is hostile to job creators in word and deed. He derides small business by telling them they didn’t build that and he wants to raise taxes on job creators. So that’s our reaction to the Tax Policy Center’s study.”

The report, however, suggests that Romney would raise taxes on many job creators, and indeed, the vast majority of Americans.

The Tax Policy Center is a joint venture of the Brookings Institution, a center-left think tank, and the Urban Institute, a non-partisan think tank.

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121 comments

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11:54AM PDT on Sep 15, 2012

Romney is a supper fool !

7:53PM PDT on Aug 5, 2012

Remember when the right was all over Kerry because he windsurfed? A sport lots of people can afford, and windsurfers were invented in America and created lots of American jobs.

Now we have a French "sport" (remember Freedom Fries), that only the very rich can afford, and what do we hear from the right?

Crickets.

7:50PM PDT on Aug 5, 2012

And dressage horses....don't forget dressage horses!

6:07PM PDT on Aug 5, 2012

Of course, he would raise taxes on the poor and middle class. It will do them all good; teach them to stop wasting their money on luxuries like food, clothing and shelter; particularly when the rich need to keep their necessities, like private yachts, gated, security guarded communities and private jets.

1:51PM PDT on Aug 5, 2012

when you get 77,000 deduction for your horse your called a thief!
not a leader!

1:31PM PDT on Aug 5, 2012

Kevin B. and Pam W. I heard that "trickle down" economics is actually a golden shower for the poor.

11:18PM PDT on Aug 4, 2012

I just watched a Rachel Maddow segment that showed Romney very agitated calling out Reid for his claims. He is getting very uptight about it. I love it because it makes him look even more like a loser.

10:22AM PDT on Aug 4, 2012

Avril....they get away with it because they CAN! The tax codes favor them. Isn't that convenient?

9:51AM PDT on Aug 4, 2012

Basic common sense. (not doing too well with our political leaders. (Repugs)
The middle class are the JOB CREATORS!
Little addition . Wish that I could claim my pets, upkeep to the IRS!.
They ,like Ann Romneys horse are ALSO a hobby. How in h--l do they get away with $77,000
deduction for the annual upkeep of their Dressage horse. Damned if I know.

9:50AM PDT on Aug 4, 2012

From HuffPo

"A second source, said to be "close to Senator [Harry] Reid," has told CNN's Dana Bash that Reid's original source for the claim that Mitt Romney "didn't pay any taxes for 10 years" exists, is a "Bain investor" and a "credible person." Dana Bash reported on this source, and the person's willingness to corroborate the allegation to which the Senate majority leader repeated on Thursday's airing of CNN's AC360.

As Bash told the show's host, Anderson Cooper:

I did speak to one source who is very close to Senator Reid who claims to also know who the Bain investor is that Reid spoke with, and insists that it is a credible person and this person if we knew the name we would understand they would have the authority and the ability to know about Romney's tax returns."

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