Romney tax plan would reduce taxes for high income people more than for middle income
the Romney tax plan would shift more of the tax burden to the middle class resulting in declining aggregate demand for the goods and services companies want to sell. this would reduces job creation and keep unemployment high.
romney tax plan - the Tax Policy Center
Governor Romney would permanently extend all the 2001 and 2003 tax cuts now scheduled to expire in 2013 and continue to “patch” the alternative minimum tax, but would allow some recently enacted provisions to expire and would repeal certain tax provisions in the 2010 health reform legislation. Tax provisions in the 2009 stimulus act and subsequently extended through 2012 would expire. These include the American Opportunity tax credit for higher education, the expanded refundability of the child credit, and the expansion of the earned income tax credit (EITC). The plan would also eliminate tax on long-term capital gains, dividends, and interest income for married couples filing jointly with income under $200,000 ($100,000 for single filers and $150,000 for heads of household) and repeal the federal estate tax, while continuing the gift tax with a maximum tax rate of 35 percent.2
At the corporate level, the Romney plan would make two major changes: 1) reduce the corporate income tax rate from 35 to 25 percent and 2) make the research and experimentation credit permanent and extend for one year the full expensing of capital expenditures. It would also allow a “tax holiday” for the repatriation of corporate profits held overseas but does not specify whether repatriated earnings would face any tax (and, if so, at what rate). In the longer run, Gov. Romney would reduce the corporate rate further in conjunction with base broadening and simplification and would move the corporate tax to a territorial system.
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The Romney plan would reduce federal tax revenues substantially. TPC estimates that on a static basis, the Romney plan would lower federal tax liability by $600 billion in calendar year 2015 compared with current law, roughly a 16 percent cut in total projected revenue. Relative to a current policy baseline, the reduction in liability would be roughly $180 billion in calendar year 2015.
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the top fifth of the households would see after-tax income go up 8.3%. The middle fifth would see after-tax incomes go up 3%.
summary table by income distribution percentiles
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