Romney's Tax Position: The Same as It Ever Was
There’s an idea gaining currency among Democrats that, since the first debate, Mitt Romney has significantly, if subtly, changed his stance on a number of key issues to hide his conservative motives for the country and appeal to swing voters. In particular, there’s a perception that Romney has deceived the public about his tax plan. Barack Obama has done a lot to promote this criticism, especially with his post-debate remarks that a “very spirited fellow who claimed to be Mitt Romney” who didn’t know that the “real” Romney had promised “$5 trillion in tax cuts for the wealthy.”
The idea is that Romney promised a tax cut – meaning a cut in the tax rate and the tax burden – for wealthy earners in the primaries, but changed his tune in the Oct. 3rd debate with Obama by promising not to reduce the overall taxes paid by top earners.
Since he unveiled his plan in late February, Romney has insisted that his reform is not intended to cut wealthy folks’ tax burdens, only the rates that they pay. The plan provided for a 20 percent reduction in all marginal tax rates, including top one, but Romney always claimed that he would replace the lost revenue by ending tax preferences that benefit high income earners. (Of course, the Romney campaign still hasn’t specified which deductions, credits, and so on he would actually cut.)
Some commentators, including Newt Gingrich during an Oct. 7th Meet the Press appearance, have become confused about Romney’s use of the word “taxes” to refer to “tax rates.” In fact, Romney has always maintained that his goal was to lower the rates, but not tax burden, of higher income earners.
On the day Romney produced the outline of his plan to reduce the marginal rates in each bracket by 20 percent, he also stipulated that the rate reductions wouldn’t entail a lowered tax burden for rich folks, saying that he would limit deductions and exemptions for high income folks in order to “continue to have progressivity in our code” and not add to the deficit. He specifically mentioned that he would “make sure the top 1% keeps paying, paying the current share they’re paying or more.”
So Obama’s insinuation that Romney is hiding his previously stated desire to cut the overall tax burden of higher-income earners is not correct.
In fact, it’s worth pointing out that, at the time he announced his plan, Romney was attacked by his Republican opponents for engaging in stealth class warfare against wealthy folks with his tax plan – exactly the opposite of Obama’s charge. Rick Santorum accused Romney of “campaigning as an Occupy Wall Street adherent” with his newly-released tax plan.
Separately, liberal critics have charged that Romney’s tax plan is unworkable because it includes three irreconcilable goals. A much-cited Tax Policy Center study found that there are not enough tax preferences for higher-incomes to make up for the lowered top rates, meaning that the plan would either raise the deficit or necessitate higher taxes on the middle class.
Following the TPC study’s logic, liberals are well within their rights to suspect that Romney’s tax plan, if carried out as promised, would result in tax rate cuts that weren’t fully offset with closed loopholes. Romney’s tax plan may contain unfulfillable promises, and the makings of another deficit-financed tax cut. But it’s the same one he proposed in the primaries. He hasn’t tried to abandon it.