Romney proposes across-the-board income tax cuts
Chandler, AZ -- For months now, Mitt Romney has been saying that he intends to make the American tax code flatter, fairer and simpler if elected president. Today, he began to lay out how.
Speaking to a crowd of about 500 in Chandler, Arizona, Romney said that his plan calls for cutting individual taxes by 20 percent.
Under such a plan, individuals currently with the highest individual tax rate -- 35 percent -- would pay a 28 percent rate instead. Similarly, all of the other tax rates -- 10 percent, 15 percent, 25 percent, 28 percent or 33 percent, depending on a person's income -- would change to 8 percent, 12 percent, 20 percent, 22.4 percent and 26.4 percent, respectively. The point of lowering marginal rates across the board was to give people more money to spend, Romney said, and to encourage businesses that pay individual tax rates to be able to hire more.
Romney said that in order to limit the impact of this plan on the deficit, and avoid adding to it, he would "limit the deductions and exemptions, particularly for high-income folks." He made a point of saying that deductions on home mortgage interest and charitable contributions for middle class families would stay in place, "but for high-income folks, we're going to cut back on that, so that we make sure the top 1 percent keeps paying the current share they're paying or more."
Romney, who is giving an economic address on Friday at Ford Field in Detroit, lumped his tax plan in with hopes to cut federal programs and balance the budget.
"So our tax plan is part of getting the economy going and getting more people back to work and adding more jobs. But I don't want to add to the deficit," he said. "That's why I cut a number of federal programs to make sure we get America on track to have a balanced budget. In the long term we have to make sure that Medicare and Social Security are preserved. It is one whole package."
Romney did not, however, detail what programs he would cut or elaborate on when the full details of his tax plan would be released.
On a conference call with reporters,Glenn Hubbard, an economic adviser for the Romney campaign, said the plan was a "very significant, pro-growth tax policy" that would create "stability and certainty." He also said that Romney's plan would remove the "legitimate" fear business owners have of future tax hikes.
In his remarks, Romney blasted President Obama, who released his own tax plan today, calling that plan deceptive and dangerous.
"He's proposing today a corporate tax plan, which I understand sounds like he's lowering taxes, but he's raising taxes - raises taxes on businesses by hundreds of billions of dollars," Romney said. "He's raising taxes on these companies that flow through - that pay taxes on individual rates. Raising taxes will kill jobs. My plan will create jobs. That's the difference between the two of us."
The Obama campaign immediately swatted back.
"The president has cut taxes on small businesses 18 times, provided every working American a tax break, and has put forward a plan to boost competitiveness, create jobs, ensure everyone pays their fair share and reduce the deficit by $4 trillion dollars," said campaign spokesman Ben LaBolt in an email. "Unfortunately, Mitt Romney doesn't understand simple math. He's giving more tax breaks to millionaires and billionaires, raising defense spending to an arbitrarily high level, and lowering corporate taxes without explaining how he would pay for them. Even his severe cuts to programs essential to the middle class like Medicare and Social Security don't come close to paying for the $2 trillion deficit increase."
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