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August 1st, 2012
07:37 PM ET

Study: Romney tax plan hurts the poor; Does it add up?

The Urban-Brookings Tax Policy Center recently reported that Mitt Romney’s tax plan will raise taxes on 95% of America. But Romney has promised a 20% tax cut to everyone. Whose math adds up?

“It’s sort of like an Olympic boxing match today the Romney camp threw a punch fast and early, pointing out that one of the authors was a former aide to president Obama,” reports CNN’s Erin Burnett.

However, one of the other authors on the report was a former aide to George H.W. Bush, and the third author worked for both Bush and Obama.

The report says that if Mitt Romney’s plan becomes a reality, tax revenue because he’s going to be cutting marginal tax rates will drop by $360 billion in the first year alone. That means someone must pay $360 billion more if it’s “revenue neutral,” which is something Romney promised in February.

Romney’s economic advisor Columbia business school’s Dean Glenn Hubbard tells OutFront that the money will come from an economy that grows more quickly than it would under Barack Obama- specifically 4% a year under Mitt Romney, something it hasn’t done 2000. The tax policy center says it is not possible.

New York University’s Professor of Taxation Daniel Shaviro said, “There really is no conceivable way that GDP growth can make a significant short-term difference to the study’s finding.”

The bottom line? More details from Romney are a must.

Burnett also discussed Romney's tax plan with Stephen Moore of Wall St. Journal Editorial Board and Matt Bennett of the Third Way:

Romney's tax plan lack specifics?

Study: Romney tax plan would shift burden toward poor

Mitt Romney's tax plan would provide large tax cuts to the very wealthy, while increasing the tax burden on the lower and middle classes, according to a study released Wednesday.

The report - produced by researchers at the Urban-Brookings Tax Policy Center - illustrates just how difficult it would be to recoup government revenue lost under Romney's plan.

The presumptive Republican presidential nominee's tax plan calls for 20% cuts to today's Bush-era income tax rates. He would also eliminate the Alternative Minimum Tax.

Those tax cuts would lead to a sharp decline in government revenue. Yet Romney insists he will make up the difference in-part by limiting deductions, exemptions and credits currently available to top-level income earners.

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soundoff (3 Responses)
  1. Debbie

    Excuse Me? Concerning Romney,s tax plan: All I have heard is that his plan would eliminate the mortgage interest deduction that the wealthy would enjoy therefore making things fairer. Does anyone understand that this deduction will be eliminated for the rest of us also? Middle class and the lower working folks in great numbers also buy homes and are paying for those homes too. Evidently Mitt Romney thinks only the very wealthy are special enough to have the privledge of buying a home!! If this is allowed to happen, the wealthy will barely notice the increased tax expense but it will be a huge burden, once again on us in the middle class and so on. I've had enough!! I'm sick and tired of us non-mega wealthy folks having to once again fork up more of our hard earned money. This didn't just start 4 years ago or even 10 years ago. It's been going on since the 1970's. The rich have seen their wealth increase by leaps and bounds while the rest of us have been barely treading water. I refuse to give up one more red penny!!! Wake up people. If we sit back and do nothing, Mitt Romney may very well take the White House and then we will be sorry. If we do not go out in droves this fall and vote against this man, we will have only ourselves to blame

    August 2, 2012 at 7:34 pm | Reply
  2. Raymond

    As always what is promised most likely will not happen..... Congress finds it easy to tax but when it comes to generating revenue it fails over and over.... I do not trust any reports that are based on future events.... Most of us cannot even predict what we will have for our meals the next day ... Saying that economy will increase because of this or that is rubbish mainly... assumptions that may or may not happen are the basis for a result, yea and if you strap on wings you can fly... I believe people should be able to keep as much as they can of what they earn... However we as people must continue to function . If you are going to use your crystal ball then it is a safer path to assume that people who have the most cushion will survive the best instead of assuming people who are barely above survial will profit from your magic.... You say I have already paid maybe maybe not... What is the worst assumpition is that the mountain of cushion will still be there after the dust settles after the destruction...

    August 1, 2012 at 10:05 pm | Reply
  3. Joey at Purdue Univ

    "Will you be an angel for a helpless multimillionaire? ... Every day, [the very wealthy] live in fear that the top marginal tax rate will be raised from its current 35% to 39.6%. But you can help. For just most of what you earn in a year, you can help [multimillionaires] make up that difference." (Jon Stewart, Sept 21st, 2011)

    August 1, 2012 at 8:36 pm | Reply

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