| Romney's plan stated Position1 #232752 For individual taxation, Romney proposes rate cuts for all taxpayers to be funded by reducing or eliminating various tax preferences. His plan aims to do this without raising the tax burden on low and middle income taxpayers, defined as $200,000 or less. It also abolishes several other taxes. |
The main focus of the public debate - and the subject matter of this map - is Romney's proposals for individual taxation. The main critics of his proposals - including the Tax Policy Center - have not chosen to challenge the arithmetic viability of his corporate tax proposals. Reproduced below is the statement of the Romney Tax Plan taken from his campaign web site. Note that the tax concessions and preferences - referred to by economists as tax expenditures - to be reduced or eliminated are not specified. Romney has defended this omission by suggesting that the details would need to be negotiated with Congress (in the second Presidential debate he floated the idea of a global limit of $25,000 on the total value of such concessions for any individual). Both critics and defenders of the plan have noted that this omission complicates the task of assessing the effects of the plan.
MITT'S PLAN
Reducing and stabilizing federal spending is essential, but breathing life into the present anemic recovery will also require fixing the nation’s tax code to focus on jobs and growth. To repair the nation’s tax code, marginal rates must be brought down to stimulate entrepreneurship, job creation, and investment, while still raising the revenue needed to fund a smaller, smarter, simpler government. The principle of fairness must be preserved in federal tax and spending policy.
Individual Taxes
America’s individual tax code applies relatively high marginal tax rates on a narrow tax base. Those high rates discourage work and entrepreneurship, as well as savings and investment. With 54 percent of private sector workers employed outside of corporations, individual rates also define the incentives for job-creating businesses. Lower marginal tax rates secure for all Americans the economic gains from tax reform. - Make permanent, across-the-board 20 percent cut in marginal rates
- Maintain current tax rates on interest, dividends, and capital gains
- Eliminate taxes for taxpayers with AGI below $200,000 on interest, dividends, and capital gains
- Eliminate the Death Tax
- Repeal the Alternative Minimum Tax (AMT)
Corporate Taxes
The U.S. economy’s 35 percent corporate tax rate is among the highest in the industrial world, reducing the ability of our nation’s businesses to compete in the global economy and to invest and create jobs at home. By limiting investment and growth, the high rate of corporate tax also hurts U.S. wages. - Cut the corporate rate to 25 percent
- Strengthen and make permanent the R&D tax credit
- Switch to a territorial tax system
- Repeal the corporate Alternative Minimum Tax (AMT)
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