Romney Declares Corporate Loopholes Off the Table in Tax Reform [View all]

[Bill USA]

http://www.americanprogressaction.org/issues/tax-reform/news/2012/08/23/33788/romney-declares-corporate-loopholes-off-the-table-in-tax-reform/

New details from the Romney campaign about the Republican presidential candidate’s tax plan reveal not only that middle-class families will shoulder the burden for tax cuts for wealthy individuals but also that they’ll have to pay for about $1 trillion in tax cuts for corporations.

Independent analyses of the former Massachusetts governor’s tax proposals already show that they would inevitably raise middle-class taxes to pay for a massive tax cut for high-income households. Earlier this month, researchers at the nonpartisan Tax Policy Center crunched the numbers behind Gov. Romney’s plan and found that the magnitude of his tax cuts for high-income households would necessitate a tax increase of at least $2,000 on middle-class families, and at least $500 on all taxpayers with incomes under $200,000.

But Gov. Romney had been somewhat vague about how he would pay for corporate tax cuts. Now, though, the campaign has clarified that none of the cost of his proposal to cut corporate taxes by about $1 trillion would be paid for by eliminating corporate tax breaks or tax loopholes. That trillion-dollar revenue loss can only be made up by further tax increases on the middle-class. Here are the details.

The Romney tax increase on the middle class

First, some background. Gov. Romney’s tax plan[1] would lower income tax rates for individuals by 20 percent (dropping the top rate from 35 percent to 28 percent) and lower the corporate rate from the current 35 percent to 25 percent. Though these rate cuts and other Romney tax policies would cost nearly $5 trillion over 10 years, Gov. Romney’s advisors continue to claim that his tax plan is “revenue neutral” compared to current tax policies. The campaign says that the lost revenue will be made up by “broadening the tax base” by eliminating tax deductions, credits, and other such tax breaks, and by counting on additional economic growth.
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