Exactly which deductions, Mr. Romney?

Updated

Some people are allergic to pollen, or peanut butter. Mitt Romney seems to be allergic to specifics. It’s an allergy he can’t seem to shake, despite his campaign’s promises to the contrary, and though it flares up around a hosts of topics — immigration policy or deficit reduction, for instance — it is perhaps most active when the discussion turns to taxation.

CBS’s Scott Pelley asked Romney what the individual federal income tax rates would be if they were his to set.

“They’d be the current rates less 20 percent,” Romney responded, explaining that all the rates, including those of the highest earners, would come down. “But,” Romney warned, “lest people think there’s going to be a huge reduction in the taxes they owe, that’s really not the case because we’re also going to limit deductions and exemptions.” He declined to get into specifics on which deductions he intended to eliminate, only saying “that’s something Congress and I will have to work out together.”

He repeated that sentiment at a rally in Ohio on Tuesday, telling the crowd, “Our individual income taxes are ones I want to reform. I want to bring the rates down. By the way, don’t be expecting a huge cut in taxes, because I’m also going to lower deductions and exemptions.” There’s that pesky allergy acting up.

Romney puts a large emphasis on reducing the deficit and balancing the budget, yet it’s unclear with an across-the-board income tax cut where he will find the revenue to do so. His “take-home pay” message and his “deficit reduction” message seem to be at odds. This is where details matter.

As we approach the first debate, Romney’s campaign is starting to inch towards more specificity.

Alarm bells went off for tax nerds this week after Romney advisor Kevin Hassett said, “he’s said he’s going to have a revenue-neutral reform.” He continued, “If you think the base-broadeners don’t add up, if you think he can’t get to 28 percent, then the right thing that would happen, as you know, if you’re going to have a revenue-neutral reform, is that they would have a different change in rates.  That’s what would happen.” Hassett confirmed the first principle is revenue-neutrality, not rate cuts. 

While revenue-neutrality isn’t deficit reduction, it means the total taxes collected would be the same (as Romney reminds us daily, the nation is $16 trillion in debt) but with a different calculus.   

 

Defecit Reduction and Mitt Romney

Exactly which deductions, Mr. Romney?

Updated