Mitt Romney’s campaign is hitting back against a study released this week showing the GOP candidate’s tax plan would raise taxes on the middle class while slashing the tax burden for millionaires, calling the report “biased” and “a joke.”
The study was developed by the centrist Tax Policy Center andauthored by economists who have worked under both the Obama and Bush administrations.
It concluded that Romney’s proposed tax cuts - which include reducing all personal income taxes rates by 20 percent, eliminating the estate tax and zeroing-out taxes on investment income for couples earning less than $200,000 per year - would slash $360 billion in federal revenues in 2015.
In order to make up for the tax cuts, Romney would “limit deductions and exemptions,” the presumptive GOP nominee said last month, although not specifying which loopholes he would close or how he would amend the tax code so that more people pay income taxes. Only 47 percent of Americans paid income taxes in 2010.
But because Romney’s proposed tax cuts are so large, according to the study, he would have to slice 65 percent of all the loopholes and deductions that are feasible to cut, such as the mortgage interest deduction, child credit, deductions for charitable contributions and exclusions for employer-provided health insurance.
Under Romney’s plan, the Tax Policy Center estimates that high-income earners would get the largest tax cut. A family that makes between $200,000 and $500,000 would pay about 6 percent less per year under his plan while families earning between $50,000 and $75,000 would get a 2 percent cut.
The cuts for high-income earners are so large that eliminating every feasible tax deduction and loophole and exemption for people making more than $200,000 would not pay for tax cuts they would receive, the study finds. So among people who earn more than $200,000 per year, it would not be possible to pay for Romney’s proposed tax cuts by reducing the exemptions and deductions that group receives.