Wednesday, February 22, 2012

Is Mitt Romney Getting Ready to Flip-Flop on Mitt Romney’s Tax Plan

Documenting the Old Plan Before the New Plan is Released and the Old Plan Goes Down the Memory Hole

Last September Mitt Romney released a 59 point economic program.  This was going to be the program that propelled Mr. Romney to the nomination, by making him the “expert” on economic policy.  It hasn’t worked out quite that way, and now Mr. Romney is telegraphing that he will release a new and improved plan.  Because once the new plan is announced it may be impossible to find the old plan, as a public service here is the old plan.  (note, if the link no longer works it’s because Mr. Romney’s campaign wants everyone to forget the old plan.)

Individual Taxes
Mitt Romney believes in the conservative principle that Americans, to the maximum extent possible, should be able to keep the money they earn. Unfortunately, as Benjamin Franklin wrote, there are only two things that are unavoidable: death and taxes. We need taxes to pay for the operations of government. But they should be collected by a system that is simple and fair, and that causes the least possible disruption to the productive economy.
·                                   • Maintain current tax rates on personal income
·                                   • Maintain current tax rates on interest, dividends, and capital gains
·                                   • Eliminate taxes for taxpayers with AGI below $200,000 on interest, dividends, and capital gains
·                                   • Eliminate the death tax
·                                   • Pursue a conservative overhaul of the tax system over the long term that includes lower, flatter rates on a broader base
Corporate Taxes
Our system of corporate taxation is also in urgent need of an overhaul. Right now, with a top marginal rate of 35 percent, it vies for the developed world’s highest, placing our companies—indeed, our entire country—at a competitive disadvantage. That is the bad news. The good news is that with the rate set so high, there is a lot of room to bring it down.
·                                   • Reduce corporate income tax rate to 25 percent
·                                   • Pursue transition from “worldwide” to “territorial” system for corporate taxation

Incidentally that “death tax” thing is what the tax code and rational people call the Estate Tax.  Eliminating it could save Mr. Romney and his family over $100 million.  But it would not be nice to mention that, so we won’t.

So what is everyone expecting now?  Well Larry Kudlow, one of the typically wrong Conservative business and financial commentators is expecting a big change.

"Team Romney tells me there will be a bolder tax-cut plan released either at the debate tomorrow night (if Mitt gets it in) or more formally at his Detroit Economic Club speech on Friday. I'm embargoed from releasing details until tomorrow. But I can say that the new plan will be across-the-board with supply-side incentives from rate reduction, and that it will help small-business owners as well as everyone else."

With a tough Michigan primary ahead does Mr. Romney once again abandon his previous positions to appeal to the Conservative voting base of the Michiganders?  Stay tuned, but really, is it all that suspenseful?

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