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Thu Jul 19, 2012, 12:04 PM

Mitt Romney’s Tax Plan Reveals His Core Vulnerability

Sahil Kapur-July 19, 2012, 5:38 AM12197

Under persistent pressure from the right during the GOP primary, Romney released a revised tax plan late in February pledging to reduce all tax rates by 20 percent, establishing a top individual rate of 28 percent. A campaign spokesperson tells TPM the plan remains current.

The presumptive Republican nominee’s chief economic adviser Glenn Hubbard told CNBC the plan would slash each of the six tax brackets from their Bush-era rates — 10, 15, 25, 28, 33, and 35 percent — down to 8, 12, 20, 22.4, 26.4, and 28 percent, respectively. He also wants to cut the corporate tax rate to 25 percent.

At the same time, he claims his plan will be deficit neutral, and that he’ll close out longer-term deficits by cutting unspecified federal programs over time.

On the surface, that difference lets Romney present himself as a tax-cutter and call the president a tax hiker. It even allows him to claim he’d provide the middle class a tax cut that Obama’s not offering. But on a deeper level it exposes Romney’s core vulnerability — not merely because, as liberals have claimed, he stands to benefit financially from his own plan, but because his numbers do not add up. And that brings the entire proposal into question.

Extending the existing top marginal rate would cost $800 billion over 10 years. Romney’s proposal to slash rates by an additional 20 percent would add $3.4 trillion more to the deficit, according to the nonpartisan Tax Policy Center.

That alone would be a huge blow to the federal budget.


and watch this Romney surrogate avoid any direct answers.

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