Romney offers some detail on tax plan
The GOP presidential candidate suggests a possible $17,000 deduction ceiling.
By Bruce Kennedy, MSN Money
Just hours before his first debate with President Barack Obama, Republican presidential candidate Mitt Romney is suggesting he might consider reducing income tax deductions to help pay for his tax reform plan.
"What we're going to do is bring down the rates for everybody, and at the same time we're going to limit deductions and credits and so forth for people at the high end," the former Massachusetts governor said during an interview with a TV station in Denver, where the debate will be held. "Very high-income people are going to have those deductions and credits come down so we can pay for bringing down the rates."
When pressed for specifics, Romney said that, as an option, "you could say everybody's going to get up to a $17,000 deduction. And you could use your charitable deduction, your home mortgage deduction or others -- health care deduction -- and you can fill that bucket, if you will, that $17,000 bucket, that way. And higher-income people might have a lower number."
Romney has proposed a permanent, across-the-board 20% cut in individual tax rates as a way to encourage entrepreneurship, savings and investment and revive the U.S. economy.
The Obama campaign, meanwhile, has criticized Romney's plan, saying it would increase taxes on Social Security benefits and slash other deductions that middle-class Americans rely on, as a way to pay for Romney's planned $5 trillion in new tax cuts.
Hey flip flopper... how about ONE tax rate for all and ONE interest rate on ALL credit? It puts all your lowlife pariah friends out of work but it fixes the country.
Romney Ryan... the nitwit ticket.
Dubya's Tax Cuts for the rich caused 750,000 job LOSSES for months before Obama took over and scam shops like Bain took down entrepreneurial businesses, terminated the personnel and sold the assets and job positions to foreign interests. Who "saves" when the passbook rate is .25%? If THIS is a plan... then the word PLAN should be banished from the dictionary. What CROCK.
Looking at Romney's numbers, I applied them to my in-laws, both retired and in their 80s (I do their taxes for them). They have about $40K/yr income (SS & some annuity investments). Currently for 2012, they would get a standard deduction of 11,900, plus 2,300 for being over age 65. Their 2 personal exemptions would be 7,600. So, their total deductions would be 21,800, and their tax liability would be 1,860 (if Romney considers them in his 47%, he missed the boat, they do pay taxes). Under Romney's plan, their total deductions are capped at $17K, so they lose $4,800 in deductions, which drives their taxable income up by the same amount from 18,200 to 23,000, and their tax liability goes up to 2,064, an increase of $204. Calculations from 2012 tax table, with Romneys rate adjustment:
17,400 X 8% (dropped from 10%) = 1,392
5,600 X 12% (dropped from 15%) = 672
Total Tax Liability = 2,064
So Romney happily tells us in the debate, with his plastic TV preacher smile, that his tax plan won't raise taxes on the Middle Class, but rather will reduce them. Well, this doesn't seem to be the case for my in-laws, now does it? Now an increase of $204 isn't a backbreaking amount, but when compared to the whopping big savings many wealthy will get, something doesn't add up. It seems as if Romney doesn't really think his plans through, simply doesn't understand the numbers, or is just throwing stuff out to make it to like he knows what he is talking about, but then again, this is the Romney we all know and love.
Also, he proposes dropping the top rates for the wealthiest by 10 percentage points (35% to 25%), but dropping the Middle Class rate by only 5 percentage points (25% to 20%). Who gets the better deal, especially when you consider that the top rate applies to a higher level of income, resulting in a much greater dollar savings AND because we have a graduated system, the wealthy will have part of their income getting the Middle Class savings as well as their own. Spin it anyway you like, but it's pretty obvious whose butts Romney is kissing.
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