The report by researchers at the Tax Policy Center, a joint project of the Urban Institute and Brookings Institution, examined Romney’s suggestion of an across-the-board 20% income tax cut financed by closing existing loopholes and concluded there was no way to make the numbers work without burdening the vast majority of Americans with higher taxes.You can read the full report here.
Romney has not said which tax breaks he would end to finance his plan, but he has suggested that he would only look to breaks that benefit the wealthy. The report concluded that notion is a fantasy no matter how it’s constructed: There simply are too many middle class tax breaks on the table to avoid skewing the burden against the average American.
“Even if tax expenditures are eliminated in a way designed to make the resulting tax system as progressive as possible, there would still be a shift in the tax burden of roughly $86 billion from those making over $200,000 to those making less than that amount.”
Does Romney have a response to this criticism? Of course; the magical boom economy which results whenever taxes are cut will generate a mystical flood of revenue that will even out the cost. And the Romney camp accuses the Tax Policy Center of being biased, as one of the co-authors was formerly one of President Obama's economic advisors. (Of course, another was one of George W. Bush's, for balance, but what would you?)
TPM notes that the TPC actually ran this highly unlikely scenario:
Apparently anticipating similar criticism from the right, the Tax Policy Center decided to humor them by including an alternate analysis in its study in which it assumed that Romney turns out to be correct and his tax proposals produce unexpected floods of new revenue. However, even that generous concession didn’t change its analysis.In sum, Romney wants to raise your taxes so that he can lower his own.
“Although reasonable models would show that these tax changes would have little effect on growth, we show that even with implausibly large growth effects, revenue neutrality would still require large reductions in tax expenditures and would likely result in a net tax increase for lower- and middle-income households and tax cuts for high-income households,” the study concluded.
It's good to be the King!