The New York Times
Nov. 2, 2012
What federal tax rate would you pay if Mitt Romney were elected president? And what would it be if Barack Obama were re-elected, assuming Congress goes along with the candidates’ proposals?
Would you pay more or less in tax? And how would that stack up against the richest Americans like Warren Buffett, who’s currently paying a lower rate than his secretary?
Considering how central these issues have been to the campaign, it’s curious how hard it is to come up with answers, perhaps because both candidates want voters to believe that someone’s else’s taxes may have to rise, but not theirs. Whether Mr. Romney’s math adds up and whether taxing the rich would make a dent in the deficit might make an interesting public policy debate, but those issues further obscure the most basic question, which is what effect the proposals will have on each of us...
William Gale, co-director of the Tax Policy Center at the Brookings Institution and the author of a report on Mr. Romney’s math, said my results bore out his point that “you can’t pay for the Romney tax rate cuts without raising taxes on the middle class,” adding: “That’s not to say tax reform is useless. You could do a 1986, Reagan kind of reform. You increase the tax on capital gains and bring down the rates. But that’s something Romney has explicitly sworn off.”
The paradox is that many Republicans and Democrats support tax reform along those lines, but no one would know that from the campaign rhetoric. “President Reagan didn’t really want to raise capital gains taxes,” Professor Leonard E. Burman, a tax expert at Syracuse University and a member of the Bipartisan Policy Center’s Debt Reduction Task Force said. “But he did because it was the only way to cut rates without shifting the tax to middle-income people. Unfortunately, the campaign hasn’t clarified the issue much. There’s been a tremendous amount of obfuscation.”
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Economic Policy Project