Romney Tax Plan Explained

[ClydeR]

The secret sauce explained..


For a detailed explanation of how the Romney-Ryan tax plan is able to cut taxes by $5 trillion without raising taxes on the middle class or exploding the deficit, simply click the button below.

More... (http://www.romneytaxplan.com/)

Ha! It's humor.

[Tgo01]

That is a pretty interesting plan Romney has there. I have to admit I'm impressed, think I'll vote for him twice.

[Back]

FACE!

[Keller]

Not surprising that the DNC won't let us click on Romney's tax plan. More smoke and mirrors from the Democrats.

[BriarFox]

Democrats are such teases. Fortunately, Romney will come along soon and pin this plan down. That'll show them what's what.

[Parkbandit]

Democrats are such teases. Fortunately, Romney will come along soon and pin this plan down. That'll show them what's what.

Still more details than "Hope and Change" ever had.

[BriarFox]

Still more details than "Hope and Change" ever had.

Your view of history is uniquely idiosyncratic.

[Jarvan]

Your view of history is uniquely idiosyncratic.

Hope and change explained...

He Hopes you don't notice all the extra change you are paying for..

Gas
Electric
Food
Healthcare
...

[Atlanteax]

Heh, nice one @ Jarvan

[crb]

President Obama's Deficit Commission put forward a plan to cut the top rate to 25% while cutting deductions and not having it result in a net tax burden cut for the rich. Romney is only proposing cutting the top rate to 28% - obviously it is possible. He simply does not want to get attacked by partisans on the specifics which is why he is being coy. That, and he doesn't want to poison the well on compromise.

If he gave details Democrats would have to attack them, because that is what Democrats do, we are 3 weeks before an election afterall. They will not be able to not attack the ideas, even if they're good ideas, even if they've been proposed by Democrats before. Republicans would likewise attack pretty much anything Obama said at this point. So if he gave details they would be attacked and all these Democrats he is hoping to work with next year would be on the record attacking the details. They wouldn't be attacking the details out of substance, but purely out of partisanship. This would make it much harder to get them on board in a bipartisan deal in the future.

By not giving specific detials like "I'm going to cut the regressive and unique in the world mortgage interest tax deduction." He is being coy and waiting to make bipartisanship easier in the future.

But obviously Simpson Bowles goes even further than Romney on taxes, so it can be done.

[diethx]

Perhaps instead of getting irritated at people for criticizing Ryan, you should get irritated with Ryan for behaving like such a stereotypical politician. If he didn't do something so douchey, no one could criticize him for doing it.

[Jarvan]

President Obama's Deficit Commission put forward a plan to cut the top rate to 25% while cutting deductions and not having it result in a net tax burden cut for the rich. Romney is only proposing cutting the top rate to 28% - obviously it is possible. He simply does not want to get attacked by partisans on the specifics which is why he is being coy. That, and he doesn't want to poison the well on compromise.

If he gave details Democrats would have to attack them, because that is what Democrats do, we are 3 weeks before an election afterall. They will not be able to not attack the ideas, even if they're good ideas, even if they've been proposed by Democrats before. Republicans would likewise attack pretty much anything Obama said at this point. So if he gave details they would be attacked and all these Democrats he is hoping to work with next year would be on the record attacking the details. They wouldn't be attacking the details out of substance, but purely out of partisanship. This would make it much harder to get them on board in a bipartisan deal in the future.

By not giving specific detials like "I'm going to cut the regressive and unique in the world mortgage interest tax deduction." He is being coy and waiting to make bipartisanship easier in the future.

But obviously Simpson Bowles goes even further than Romney on taxes, so it can be done.

Stop pointing out facts!! Damn you.

[Jarvan]

Perhaps instead of getting irritated at people for criticizing Ryan, you should get irritated with Ryan for behaving like such a stereotypical politician. If he didn't do something so douchey, no one could criticize him for doing it.

Wait... what? This thread is about Ryan? I had no idea, thought it was a joke about Romney's tax plan.

[diethx]

Did I post that in the wrong thread? Woops.

[Kembal]

President Obama's Deficit Commission put forward a plan to cut the top rate to 25% while cutting deductions and not having it result in a net tax burden cut for the rich. Romney is only proposing cutting the top rate to 28% - obviously it is possible. He simply does not want to get attacked by partisans on the specifics which is why he is being coy. That, and he doesn't want to poison the well on compromise.

If he gave details Democrats would have to attack them, because that is what Democrats do, we are 3 weeks before an election afterall. They will not be able to not attack the ideas, even if they're good ideas, even if they've been proposed by Democrats before. Republicans would likewise attack pretty much anything Obama said at this point. So if he gave details they would be attacked and all these Democrats he is hoping to work with next year would be on the record attacking the details. They wouldn't be attacking the details out of substance, but purely out of partisanship. This would make it much harder to get them on board in a bipartisan deal in the future.

By not giving specific detials like "I'm going to cut the regressive and unique in the world mortgage interest tax deduction." He is being coy and waiting to make bipartisanship easier in the future.

But obviously Simpson Bowles goes even further than Romney on taxes, so it can be done.

...

Simpson-Bowles was not revenue-neutral and was designed to cut the deficit. Romney is claiming his tax plan is revenue-neutral, which is why his math doesn't work. You're comparing apples to oranges.

[Parkbandit]

...

Simpson-Bowles was not revenue-neutral and was designed to cut the deficit. Romney is claiming his tax plan is revenue-neutral, which is why his math doesn't work. You're comparing apples to oranges.

If he hasn't released details about his plan.. how exactly do you know the math doesn't work?

Can't have it both ways.

[Bobmuhthol]

Hope and change explained...


He Hopes you don't notice all the extra change you are paying for..


Gas
Electric
Food
Healthcare
...Here's a not-so-comprehensive list of prices that will not decrease under Romney:


Gas
Electric
Food
Healthcare
...

If he hasn't released details about his plan.. how exactly do you know the math doesn't work?

Can't have it both ways.I'll let a professor from my alma mater tackle that one: http://www.forbes.com/sites/leonardburman/2012/10/04/about-mitt-romneys-5-trillion-tax-cut/

[crb]

...

Simpson-Bowles was not revenue-neutral and was designed to cut the deficit. Romney is claiming his tax plan is revenue-neutral, which is why his math doesn't work. You're comparing apples to oranges.

Uh... you've tricked yourself, you're either confused as to what "revenue neutral" means, confused that you can be not neutral either lower or higher, or you're just plain confused. There is a huge contradiction with your statement.

Simpson Bowles raises the tax burden on the wealthy while lowering their top tax rate to 25%, increasing federal revenue.

Romney claims to keep the tax burden on the wealthy the same while lowering their top rate to 28%, while keeping federal revenue the same.

Obviously, if Simpson-Bowles is true, Romney HAS to be true. Simpson Bowles is saying they can cut taxes more than Romney and bring in more revenue than Romney at the same time. If that is possible, then cutting taxes less and bringing in less revenue surely has to be possible too.

[crb]

Oh, and of course the Tax Policy Center study that everyone points too has already been refuted by... the Tax Policy Center. They called Obama's ads using it misleading and said that the math can add up.... also, the TPC is not nonpartisan, they're left leaning, everyone knows this. The Tax Foundation is their right leaning counterpart. Their study is here:

http://taxfoundation.org/article/simulating-economic-effects-romneys-tax-plan

[Jarvan]

Here's a not-so-comprehensive list of prices that will not decrease under Romney:


Gas
Electric
Food
Healthcare
...
I'll let a professor from my alma mater tackle that one: http://www.forbes.com/sites/leonardburman/2012/10/04/about-mitt-romneys-5-trillion-tax-cut/

So.. mind pointing out any specifics while your at it on how Obama would fix the deficit, our economy, and the above's prices? I am sure he has given detailed plans on exactly what he would do with another 4 years after all.

[Bobmuhthol]

What will Romney do?

[Fallen]

Close loopholes!

[Jarvan]

What will Romney do?

So you attack Romney on specific's while Obama doesn't have any either?

Other then the same old same old, make the Rich pay more ( maybe 70 billion a year ) while he spends more money.

Did you also know that he calls for a perm extension of the Payroll tax cut? How exactly is that a good thing by the way? Perm reduce how much we put into SS/Medicare, while refusing to do anything about their growing costs. Makes perfect sense to me!

[Bobmuhthol]

Uh... you've tricked yourself, you're either confused as to what "revenue neutral" means, confused that you can be not neutral either lower or higher, or you're just plain confused. There is a huge contradiction with your statement.

Simpson Bowles raises the tax burden on the wealthy while lowering their top tax rate to 25%, increasing federal revenue.

Romney claims to keep the tax burden on the wealthy the same while lowering their top rate to 28%, while keeping federal revenue the same.

Obviously, if Simpson-Bowles is true, Romney HAS to be true. Simpson Bowles is saying they can cut taxes more than Romney and bring in more revenue than Romney at the same time. If that is possible, then cutting taxes less and bringing in less revenue surely has to be possible too.Who the fuck is responsible for your understanding of numbers? Your conclusions don't actually come from the statements. You just said, "Here's some stuff, and also, this implies that," but there's no connection.

So you attack Romney on specific's while Obama doesn't have any either?No, I'm saying that no president can reduce global energy demand, so those prices are not decreasing. Healthcare is also outside the scope of the president's office.

[Latrinsorm]

If he gave details Democrats would have to attack them, because that is what Democrats do, we are 3 weeks before an election afterall. They will not be able to not attack the ideas, even if they're good ideas, even if they've been proposed by Democrats before. Republicans would likewise attack pretty much anything Obama said at this point. So if he gave details they would be attacked and all these Democrats he is hoping to work with next year would be on the record attacking the details. They wouldn't be attacking the details out of substance, but purely out of partisanship. This would make it much harder to get them on board in a bipartisan deal in the future.How many times does Jon Stewart have to do the "this is what they said today, this is what they said 5 seconds ago" routine? Politicians don't care at all about behaving like total hypocrites.
Simpson Bowles raises the tax burden on the wealthy while lowering their top tax rate to 25%, increasing federal revenue.

Romney claims to keep the tax burden on the wealthy the same while lowering their top rate to 28%, while keeping federal revenue the same.

Obviously, if Simpson-Bowles is true, Romney HAS to be true. Simpson Bowles is saying they can cut taxes more than Romney and bring in more revenue than Romney at the same time. If that is possible, then cutting taxes less and bringing in less revenue surely has to be possible too.This just doesn't follow.

SB: tax burden UP, tax rate DOWN, revenue UP. (Implied: something else happens besides rate adjustment that increases tax paid.)
Romney: tax burden SAME, tax rate DOWN, revenue SAME. (Same implication, but not necessarily the same something else.)

There is no logical link between the two because of the unspecified parts. SB can be true and Romney false, vice versa, both can be true, neither can be true. When dealing with something as intricate and complex as taxation, it is probably not a good idea to assume these unspecified parts will be literally identical.

[Bobmuhthol]

And in case it isn't obvious (it's certainly not to crb), reducing a top marginal tax rate is not even close to the same thing as "cutting taxes."

[~Rocktar~]

No, I'm saying that no president can reduce global energy demand, so those prices are not decreasing. Healthcare is also outside the scope of the president's office.

No, but a president can take steps to increase the supply and reduce the cost of production and delivery. Both of which will or should reduce prices of energy. And since Obamacare was ruled constitutional in the biggest pile of hypocrisy I think I have ever known about, yes health care can and is under the auspices of the Federal Government and by executive order or decree, the president's office can influence or control it.

[~Rocktar~]

And in case it isn't obvious (it's certainly not to crb), reducing a top marginal tax rate is not even close to the same thing as "cutting taxes."

How in holy fuck, given all other things being equal, can a reduction in tax rate not equal a reduction in taxes? Are you high, drunk or just fucking stupid?

[Bobmuhthol]

If you'll take a moment to learn how taxation works, it should be clear to you.

I also didn't say "given all other things being equal," you did. And that assumption, which is totally invalid, is not even relevant here.

[Kembal]

If he hasn't released details about his plan.. how exactly do you know the math doesn't work?

Can't have it both ways.

Bob's quoted the link, but the little detail he has given is enough to conclude the math doesn't work.

[crb]

Who the fuck is responsible for your understanding of numbers? Your conclusions don't actually come from the statements. You just said, "Here's some stuff, and also, this implies that," but there's no connection.
No, I'm saying that no president can reduce global energy demand, so those prices are not decreasing. Healthcare is also outside the scope of the president's office.

It is very hard for me to do so, but sometimes I have to remember that not everyone on the Internet is intelligent.

Case in point: Bob.

I don't think you've concocted this whole story about actually going to college, that would be pretty out there to be such a repeat liar on that, so I have to believe you, but it just doesn't jive with your lack of perception here. I can only conclude you're too partisan to think straight on political issues.



SB: tax burden UP, tax rate DOWN, revenue UP. (Implied: something else happens besides rate adjustment that increases tax paid.)
Romney: tax burden SAME, tax rate DOWN, revenue SAME. (Same implication, but not necessarily the same something else.)

There is no logical link between the two because of the unspecified parts. SB can be true and Romney false, vice versa, both can be true, neither can be true. When dealing with something as intricate and complex as taxation, it is probably not a good idea to assume these unspecified parts will be literally identical.

Let me spell this out for you in the form of a skit.

Romney: I want to reduce the top federal marginal tax rate to 28%. But I will not reduce the federal tax burden on the rich while doing so because I'll cut deductions.

Liberals: WAAAA WAAA LIAR IT IS IMPOSSIBLE!

Simpson-Bowles: We will reduce the top federal tax rate to 25%, and we will raise the federal tax burden on the rich. You can trust us because we're bipartisan disinterested former politicians and people on the left and right say our idea is good, no one calls us liars.

Now, the tax burden is the portion of the tax bill a certain group pays. When the burden goes up, the group pays more money. It is a direct relationship. Maybe you're confused and you don't know what the phrase "tax burden" means in discussions of federal tax policy, and that got you bamboozled.

So, if you can cut a rate to 25%, but through removing deductions have the amount paid (the burden) increase.

Then it HAS TO BE POSSIBLE to cut that same rate instead to 28% and have the amount paid (the burden) stay the same.

Let me say it again: Simpson-Bowles lowers rates more, but gets more revenue out of it. If that is possible, then it has to be possible to lower rates less, and not get more revenue out of it.

How about a third time: The big liberal concern, the big attack on Romney, is that he'll cut the top rate to 28% and rich people will buy more boats. He says no, you say impossible. If Simpson-Bowles is able to cut the top rate to 25% and not have the rich people buy more boats, then it is OBVIOUSLY possible to cut the rate to 28% and not have the rich people buy more boats. Romney is proposing a smaller tax rate cut that Simpson-Bowles, period, end of story.

Yes, Romney hasn't detailed all the nitty gritty that the SB plan gives, but that doesn't mean it is impossible to design such a plan, because SB is an example. Obviously.

[crb]

And in case it isn't obvious (it's certainly not to crb), reducing a top marginal tax rate is not even close to the same thing as "cutting taxes."

I don't know why you call me out here. That is exactly the point. You CAN cut rates without cutting taxes. That is exactly the Romney plan. That is what I'm saying.

[Bobmuhthol]

You're still wrong, for what it's worth.

[Bobmuhthol]

I don't know why you call me out here. That is exactly the point. You CAN cut rates without cutting taxes. That is exactly the Romney plan. That is what I'm saying.Hold on there, bro, someone would like to have a word with you:

How in holy fuck, given all other things being equal, can a reduction in tax rate not equal a reduction in taxes? Are you high, drunk or just fucking stupid?

[crb]

Ya, Rocktar is wrong. I'm not voting for Rocktar.

[~Rocktar~]

Ya, Rocktar is wrong. I'm not voting for Rocktar.

Actually I am not and Bob, bless his naive, idiotic little heart managed to catch what is/was going on. Here's his quote:


I also didn't say "given all other things being equal," you did. And that assumption, which is totally invalid, is not even relevant here.

My statement was absolutely correct given the caveat of "all other things being equal." Bob did point out that all other things are not equal. And in a dynamic system like the economy nothing can be practically examined given that caveat. If you hold all other variables equal and cut the tax rate, then you have cut tax revenue and thus taxes. Now if, as in the Romney plan, you cut the rate and close the gaps, then you can end up with no net change in tax burden and thus no tax cut.

There is, however, a practical and absolute limit on how much you can cut the rate, close the deductions and still keep the tax burden the same. I am pretty sure that it is virtually impossible to hit exactly since the more deductions you remove, the more tax fraud is committed along with a host of other issues.

Have fun going back and forth arguing with Bob the bonehead. Unless and until we decrease spending in relation the GDP either through growth or spending cuts, all the taxation in the world won't matter as the trillions in unfunded social mandate comes due to pay.

[Latrinsorm]

It is very hard for me to do so, but sometimes I have to remember that not everyone on the Internet is intelligent.

Case in point: Bob.

I don't think you've concocted this whole story about actually going to college, that would be pretty out there to be such a repeat liar on that, so I have to believe you, but it just doesn't jive with your lack of perception here. I can only conclude you're too partisan to think straight on political issues.



Let me spell this out for you in the form of a skit.

Romney: I want to reduce the top federal marginal tax rate to 28%. But I will not reduce the federal tax burden on the rich while doing so because I'll cut deductions.

Liberals: WAAAA WAAA LIAR IT IS IMPOSSIBLE!

Simpson-Bowles: We will reduce the top federal tax rate to 25%, and we will raise the federal tax burden on the rich. You can trust us because we're bipartisan disinterested former politicians and people on the left and right say our idea is good, no one calls us liars.

Now, the tax burden is the portion of the tax bill a certain group pays. When the burden goes up, the group pays more money. It is a direct relationship. Maybe you're confused and you don't know what the phrase "tax burden" means in discussions of federal tax policy, and that got you bamboozled.

So, if you can cut a rate to 25%, but through removing deductions have the amount paid (the burden) increase.

Then it HAS TO BE POSSIBLE to cut that same rate instead to 28% and have the amount paid (the burden) stay the same.

Let me say it again: Simpson-Bowles lowers rates more, but gets more revenue out of it. If that is possible, then it has to be possible to lower rates less, and not get more revenue out of it.

How about a third time: The big liberal concern, the big attack on Romney, is that he'll cut the top rate to 28% and rich people will buy more boats. He says no, you say impossible. If Simpson-Bowles is able to cut the top rate to 25% and not have the rich people buy more boats, then it is OBVIOUSLY possible to cut the rate to 28% and not have the rich people buy more boats. Romney is proposing a smaller tax rate cut that Simpson-Bowles, period, end of story.

Yes, Romney hasn't detailed all the nitty gritty that the SB plan gives, but that doesn't mean it is impossible to design such a plan, because SB is an example. Obviously.That was actually my post you were responding to, but I'm afraid you've missed the crucial point. You didn't say "if SB is possible, Romney must be possible"; that would have followed. You said "if SB is true, Romney must be true". That does not. :)

[ClydeR]

Let me say it again: Simpson-Bowles lowers rates more, but gets more revenue out of it. If that is possible, then it has to be possible to lower rates less, and not get more revenue out of it.

How about a third time: The big liberal concern, the big attack on Romney, is that he'll cut the top rate to 28% and rich people will buy more boats. He says no, you say impossible. If Simpson-Bowles is able to cut the top rate to 25% and not have the rich people buy more boats, then it is OBVIOUSLY possible to cut the rate to 28% and not have the rich people buy more boats. Romney is proposing a smaller tax rate cut that Simpson-Bowles, period, end of story.

There are two big problems with comparing the Romney plan to the Bowles-Simpson plan.

First, you are only looking at taxes on ordinary income. The Bowles-Simpson plan would actually increase revenue collections by about $1 or $2 trillion, depending on which alternative you take, while Romney says that overall revenue would remain the same under his plan. Bowles-Simpson achieved their revenue increase in part by taxing dividends and capital gains at ordinary income rates, instead of the preferential rate of 15% that Romney pays on most of his income. Romney has pledged to maintain the special 15% rate.

Second, Romney pledges that in broadening the base by reducing deductions, he will not reduce savings incentives, such as incentives for 401(k) plans. But Bowles-Simpson dramatically reduced the benefits for savings plans. Those benefits mostly flow to higher income taxpayers. Bowles-Simpson worked mathematically only because it reduced savings incentives.

Also, there was never an official Bowles-Simpson plan. The members of the committee, including Paul Ryan, could not reach an agreement because of the Norquist tax pledge. The Bowles-Simpson plan that everybody talks about was the report of the two committee chairmen.

[crb]

There are two big problems with comparing the Romney plan to the Bowles-Simpson plan.

First, you are only looking at taxes on ordinary income. The Bowles-Simpson plan would actually increase revenue collections by about $1 or $2 trillion, depending on which alternative you take, while Romney says that overall revenue would remain the same under his plan. Bowles-Simpson achieved their revenue increase in part by taxing dividends and capital gains at ordinary income rates, instead of the preferential rate of 15% that Romney pays on most of his income. Romney has pledged to maintain the special 15% rate.

Not sure why I'm bothering to respond to Clyde. But the fact remains, that the plan cuts marginal tax rates lower than Romney wants to without allowing millionaires to buy more boats. You're saying that what? They'll make a little more revenue from capital gains tax heights which will fund the lower marginal rates on ordinary income? Except... everyone knows that when you raise investment taxes tax receipts go down, and when you lower them they go up. IT is counter intuitive unless you accept the fact that human beings respond to incentives and disincentives.



Second, Romney pledges that in broadening the base by reducing deductions, he will not reduce savings incentives, such as incentives for 401(k) plans. But Bowles-Simpson dramatically reduced the benefits for savings plans. Those benefits mostly flow to higher income taxpayers. Bowles-Simpson worked mathematically only because it reduced savings incentives.


Obama says Romney wants 5 trillion in tax cuts through rate reductions over 10 years, that is 500 billion a year. We have way more than $500 billion in tax expenditures every year. Very easy to get to that number without touching 401k plans. I wasn't aware though that you think 401ks benefit mostly rich people. They have annual limits. Roth IRAs are completely blocked from rich people, though there is a temporary conversion loophole for small dollar amounts right now.




Also, there was never an official Bowles-Simpson plan. The members of the committee, including Paul Ryan, could not reach an agreement because of the Norquist tax pledge. The Bowles-Simpson plan that everybody talks about was the report of the two committee chairmen.
[/quote]

Incorrect. The rule was if the plan got enough votes, it would have to be voted on in the house and senate. A plan was created, and filed, and voted on, it simply did not reach the threshold needed for automatic votes in the full congress.