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Wed Aug 1, 2012, 11:57 AM

New Analysis Shows Romney Tax Plan Would Raise Taxes On Middle Class Families By More Than $2,000

New Analysis Shows Romney Tax Plan Would Raise Taxes On Middle Class Families By More Than $2,000

By Pat Garofalo

On the campaign trail, Mitt Romney has been promising that he will cut taxes “across the board,” while also instituting tax reform that will not add to the nation’s deficit. But a new report from the Tax Policy Center at the Brookings Institution shows that this is much easier said than done.

In fact, if Romney were to actually implement his plan to reduce tax rates by 20 percent while eliminating tax deductions in order to pay for it, taxpayers with more than $200,000 would certainly see a tax cut. But everyone else — 95 percent of Americans — will see their taxes increase. And this result occurs even assuming that Romney would eliminate tax deductions so as to make the tax as progressive as possible:

To estimate how average household tax burdens among different income groups would change as a result of this shift, we assume that the available tax expenditures are curtailed “from the top down” in order to make the tax plan as progressive as possible…Even after eliminating all available tax expenditures for households earning more than $200,000, this group still faces a net tax break. Americans making over $1 million would see an increase in after-tax income of 4.1 percent (an $87,000 tax cut), those making between $500,000 and $1 million would see an increase of 3.2 percent (a $17,000 tax cut), and those making between $200,000 and $500,000 would see an increase of 0.8 percent (a $1,800 tax cut).

Because taxpayers above $200,000 as a group have received a net tax cut, revenue neutrality requires that taxpayers below $200,000—about 95 percent of the population—experience a tax increase.

Here’s how the plan would affect the average taxpayer in each income group. As the column labeled “revenue neutral” shows, all taxpayers making less than $200,000 would see their taxes go up by hundreds, if not thousands, of dollars. In particular, families with children would see their taxes go up by $2,041, on average:

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Mitt, the guy who didn't pay any taxes for 10 years, wants to increase taxes on 95 percent of Americans to pay for tax cuts for himself.

Now, that's rich!

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Reply New Analysis Shows Romney Tax Plan Would Raise Taxes On Middle Class Families By More Than $2,000 (Original post)
ProSense Aug 2012 OP
ProSense Aug 2012 #1

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