National Policy Director James Kvaal wraps up what we know about Mitt Romney’s economic plan to raise taxes on the middle class while giving tax breaks to the wealthy:
We learned a lot about Mitt Romney’s tax plan this week. Here’s a recap in case you missed it.
For months, Romney has insisted that he will pay for his $5 trillion tax plan by closing tax deductions—but he won’t tell us which ones. Thanks to a new report from the nonpartisan Tax Policy Center, we know that there is no way to fill in the blanks without raising middle class taxes. Here’s the report, our summary, and a calculator to help you see how Romney’s plan would impact you and your family.
A look at what we learned:
Romney’s plan offers a large tax cut for the wealthy, no matter how you slice it: Romney’s tax cuts for the wealthy are so large that closing every tax benefit they get—other than preferential rates on investment income, which Romney says he won’t touch—would still cut the average multi-millionaire’s taxes by $250,000. That’s just math. And it comes on top of all the Bush tax cuts.
They have no way to pay for these tax cuts: Romney and his campaign have emphasized that his tax cuts would be “revenue-neutral”—meaning no net loss of tax revenue. But if you are cutting taxes on the top, that means you have to raise taxes for everyone else. And while Romney’s advisors said the economy would grow, they ignored the fact that, even when the Tax Policy Center considered unrealistically generous estimates (derived from the academic work of Romney’s own advisor), they concluded that Romney’s plan couldn’t create enough growth to pay for his tax cuts for the wealthy.
They refused to clarify his plan: Romney had said that his tax plan “can’t be scored.” Now we know what Romney really meant: that he didn’t want it to be scored. Walking through the details means showing that he is paying for deep tax cuts for the wealthy with tax increases on the middle class. As Josh Barro put it, “If Romney thinks TPC missed something, and he has a way to make his plan work without a middle class tax increase, he should release the details that show what that is. So long as he refuses to tell us exactly what his tax plan is, Romney has no one to blame for distortions of the plan but himself.”
The bottom line: Filling in the blanks on Romney’s plan requires large tax increase on the middle class. Don’t take our word for it—take a look at what others have found.
Ezra Klein: “The numbers never worked out. No matter how hard the Tax Policy Center labored to make Romney’s promises add up, every simulation ended the same way: with a tax increase on the middle class.”
Wall Street Journal: “A new study released Wednesday suggests that Mitt Romney’s tax plan would benefit the rich and hurt the poor and middle class, no matter how current blanks in the plan are filled in.”
Factcheck.org: “Romney has said he would offset the loss of personal income tax revenue (estimated at $360 billion a year by the Tax Policy Center) by reducing tax deductions and credits. And he has said he would do this while making sure that those at the top keep paying the ‘same share of the tax burden they’re paying now … Romney has failed to produce evidence that what he promises is possible. And we judge that the weight of evidence and expert opinion is clear —it’s not possible.”
Jonathan Chait: “Mitt Romney appears to have blundered his way into a bona fide political disaster with his tax plan.”