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1 Gerald Prante, Would the Romney Tax Plan Necessarily Reduce after-Tax Incomes for the Middle Class 1 (2012)

handle is hein.taxfoundation/ffdcj0001 and id is 1 raw text is: FUDAT UN ° October 1, 2012 No. 329 Would the Romney Tax Plan Necessarily Reduce After-Tax Incomes for the Middle Class? By Gerald Prante Tax Foundation Adjunct Scholar Introduction In August, the Urban-Brookings Tax Policy Center (TPC) released a report' claiming to show that Mitt Romney's tax reform plan would necessarily raise taxes on middle-class taxpayers and reduce their after-tax incomes, while giving a significant tax cut to high-income taxpayers. This conclusion is based on a distributional analysis that assumes Romney's revenue-neutral tax reform plan, which includes an across-the- board 20 percent cut in marginal income tax rates and an elimination of the alternative minimum tax (AMT), would require a significant reduction in most tax expenditures, including most notably the child tax credit, mortgage interest deduction, state and local tax deduction, and the exclusion of employer-provided health insurance. This TPC study showing Romney's tax plan as raising taxes on the middle-class yet cutting taxes for the rich has generated quite a bit of attention. Some economists such as Martin Feldstein2 and Harvey Rosen3 have taken issue with the study, arguing that Romney's tax plan would not necessarily require raising taxes on the middle class. 1 Samuel Brown, William Gale, & Adam Looney, On the Distributional Effects of Base-broadening Income Tax Reform, Urban- Brookings Tax Policy Center, Aug. 1, 2012, htt://wvwtaxp....i.v.jc..)..n..te..ro..rg/.Up..adedPDF/ 1001628-Base-Broadening-Tax- Reformnpdif. 2 Martin Feldstein, Romney's Tax Plan Can Raise Revenue, WALL STREET JOURNAL, Aug. 28, 2012, http://on~ine.wsicor...i.c..... :1:.c.e/S.B.10000().. . ...872396390444327.20 () 4..5776Z174.21. 27.0..0..0592.html. SHarvey Rosen, Growth, Distribution, and Tax Reform: Thoughts on the Romney Proposal (Working Paper No. 228, Princeton U niv er s ity, S e pt. 20 12), .http____i/__/x__v__,p r in c e t on. ed u/ cep sxvrkin gpape rs /228 r ose n.pd f.