In numerous interviews, debates, and political literature, Governor Romney has stated that he opposes any and all tax increases and that he favors the lowest tax rate possible. Governor Romney supported the Bush tax cuts and making them permanent. In 2008, he stated that the Bush tax cuts helped get our economy going again when we faced the last tough times.
One item that Governor Romney has consistently supported is allowing families making below a certain amount to save their money for retirement without being taxed on it. The usual amount quoted by Governor Romney is around a family earning less than $200,000 to $250,000.
In the 2008 and 2012 elections, Governor Romney was asked about his support for the Fair tax system. He noted that a consumption tax did have a lot going for it in a number of areas, but he does not support the system. The main reasons for his opposition were the high rate needed to bring in the approprate amount of revenue and the application of the tax on items like new houses and not on already built houses. He notes that this would be devasting for the housing market.
Governor Romney's 2008 tax plan promised a specific set of tax cuts for individuals and businesses that mirrored his statements in debates and op-eds. The pledges included:
Permanently Reduce The Lowest Income Tax Bracket to 7.5%
Permanently Eliminate Payroll Taxes On Employees Over The Age Of 65
Make Middle-Class Savings Tax Free
Make the Bush Tax Cuts permanent
End the Death Tax
Patch or permanently end the AMT
Make The Research And Development Tax Credit Permanent
Oppose Any Increase In Social Security Taxes
Reduce The Corporate Tax Rate To 20% Over Two Years
Governor Romney's 2012 tax plan is less specific. The plan calls for the elimination of the estate tax, the lowering of the corporate tax rate to 25%, and making the Bush tax cuts permanent. However, beyond that it promises only a flatter system with corporate taxes moved to a territorial system.
Individual Taxes
Maintain marginal rates at current levels
Further reduce taxes on savings and investment
eliminate the death tax
Long term goal - pursue a flatter, fairer, simpler structure
Corporate Taxes
Lower the corporate income tax rate to 25%
Transition to a "territorial" tax system
Fox News Appearance
In March of 2007, Governor Romney appeared on Fox News and spoke about his support for lower overall taxes, and his support for the Bush tax cuts. He stated that he would like to see zero taxes on capital gains and dividends. (comments start at 3:05)
South Carolina Debate
In May of 2007, Governor Romney participated in the South Carolina Presidential debate. He noted during that debate that he would not raise taxes.
WENDELL GOLER (Fox News): Gentlemen, we have a series of questions on the economy, the budget, taxes and entitlements. And I have one for each of you, starting with you, Governor Romney.
Your critics have called you "flip-flop Mitt" for, among other things, your decision to take the "no new taxes" pledge this year after refusing to do so in 2002. Tell me why your decision to take the pledge shouldn't be seen as a blatant appeal to the party base, sir?
MR. ROMNEY: I want to make it very clear that I'm not going to raise taxes.
As governor of Massachusetts, I made it very clear there, and I did not raise taxes. We faced a huge budget gap, and I went in and said, you know, what? I know some people want to raise taxes, but that's going to hurt working families and scare away jobs. I recognize that raising taxes could also lead to a slowdown in our economy, and so we didn't do it. We balanced our budget, and that's exactly what I'll do with the federal government.
They key thing you have to consider, as you look at what's happening in the federal government, is that Washington is broken. We need to have fundamental change in the way business in Washington is carried out. What that means is we're going to have to have leadership that can reorganize the government. We're going to have about 40 percent of the government employees turn over in the next couple of terms. And if we can -- we can reduce the employment there, but more importantly, is to go through all the agencies, all the departments, all the programs and cut out the unnecessary and the wasteful.
We're also going to have to do something we talk about on in Iraq. We all talked about benchmarks. Well, how about benchmarks in Washington? Let's lay out what we're going to get done, and instead of just talking about the same old same old, let's streamline and make Washington more efficient.
Iowa Presidential Debate
In August of 2007, Governor Romney participated in the Presidential Debate in Iowa. When asked about the Fair Tax, Governor Romney states that he opposes the measure, and gives a number of reasons why.
ROMNEY: There are a lot of features that are very attractive about a fair tax. Getting rid of the IRS is something we’d all love. But the truth is, we’re going to have to pay taxes. We are the largest economy in the world. We’ve added -- during the time Europe added 3 million jobs, we’ve added about 50 million jobs in this country. And so completely throwing out our tax system and coming up with an entirely new one is something we have to do very, very carefully. The president’s commission on taxation -- tax reform -- looked at this and said: Not a good idea. Some of the reasons...
HUCKABEE: They didn’t look at that...
(CROSSTALK)
ROMNEY: Let me -- hold on, let me complete. Some of the reasons are the fair tax, for instance, charges a 23 percent tax, plus state sales tax, on a new home, when you purchase a new home. But if you buy an old home, there’s no tax. Think what that might do to the construction industry. We need to thoroughly take it apart before we make a change of that nature. That’s why my view is, get rid of the tax on savings and let middle-income people save their money tax-free.
Des Moines Register Interview
In December of 2007, Governor Romney was interviewed by the Des Moines Register and stated that he was opposed to any tax increases and that he would support tax simplification, but that establishing a fair or flat tax was not feasible.
I am very much, very much and ademately opposed to tax increases. The answer is not to increase taxes. That has a doubly negative effect. It not only is depressing to the individuals that pay higher taxes, but it's depressing on the economy.
I'm probably not going to be recommending throwing out the code and starting over. We all can dream about a much simpler, fairer, flater system. There are people who love the fair tax as a consumption tax. That has a lot of positive features associated with it and I would love to emulate some of those.
There are people who talk about the flat tax, but one person's flat tax is another person's unfair tax depending on which type of income gets taxed. So, I look to say "can we make the tax rate lower for all Americans, can we make the tax on savings, particularly for middle income americans disappear."
I propose that people of middle-incomes ... and you probably want to know exactly what level that is and I haven't set it yet because we are working on the economics. People of middle income in my view ought to be able to save money and not have to pay taxes on interest, dividends, and capital gains. Because I would like to encourage savings and I would like to get tax rates down. That has a feature that sounds something like the flat tax, but that's not something that applies to the very, very wealthy.
I'd also like to see us look at our corporate tax structure. Right now, we have the second highest corporate income tax in the world, right after Japan. That's a problem for corporations deciding to grow or expand in our country and I'd like for it to be comparable. We don't have to be the lowest, but I don't want to be the highest.
So I would look at our policies to see if we can't lower our rates to make it cheaper and easier for people to save for having a simpler, flater tax system.
CNN Interview
In a January 2008 interview on CNN, Governor Romney was contrasting himself against Senator McCain. He noted that Senator McCain opposed the Bush Stimulus while he supported it, and Senator McCain opposed the Bush tax cuts and Governor Romney supported it.
ROMNEY: Well, Senator McCain is a fine man and an honorable and courageous individual. But he has been in Washington all of his career. And I don't think you're going to see change in Washington by somebody who's been such a part of it all of these years.
I think people recognize that, particularly with the challenges we face in our economy, it's essential to have somebody who's had a job in the economy, who knows how the economy works and can fight to bring good jobs for middle-income Americans.
There are other differences, of course. He opposed the Bush tax cuts. Even now, with the stimulus being proposed, he apparently is not in favor of that.
I proposed a very bold stimulus program to get our economic working again. You know, having a strong economy is key to great jobs and key to a lot of good things that happen in this country.
...
BLITZER: Last Sunday, Mitt Romney was on "Late Edition," Gene Sperling, and I asked him, if he were president, what he would do immediately to deal with this potential of a recession, the fears of a recession. Listen to what he told me.
(BEGIN VIDEO CLIP)
MITT ROMNEY, REPUBLICAN PRESIDENTIAL CANDIDATE: Immediately I'd go to try and get a reduction on taxes on middle-income Americans. Specifically, I proposed having people who earn under $200,000 a year be allowed to save their money tax-free. It means no tax on interest, dividends or capital gains.
(END VIDEO CLIP)
California Debate
In January of 2008, Governor Romney participated in the Presidential debate in California at the Reagan Library. When asked, Governor Romney did acknowledge that he raised fees on business expenses.
COOPER: Governor Romney?
ROMNEY: OK, I got a little work to do here. Let me help you with the facts here, Senator.
First of all, my lieutenant governor, Kerry Healey, endorsed me, and is supporting me, and is working all over the state for me. My predecessor in office, Governor Swift, Governor Swift is supporting you.
ROMNEY: When you say that our state ranked number three in job creation, the study you're relying upon is a study that included her term in office. And during her term in office, 141,000 jobs were lost.
During my term in office, we added jobs. And from the lowest point we added 60,000 new jobs. So that study, unfortunately, included the wrong data.
With regards to fees, we raised fees $240 million. Not $730 million. Facts are stubborn things. We audited our fee increase, because, of course, we cared.
Now, why did we raise fees $240 million? We had a $3 billion budget shortfall, we decided we were not going to raise taxes, and we found that some fees hadn't been raised in as many as 20 years. These were not broad-based fees for things like getting your driver's license or your license plate for your car, but instead something like the cost of a sign on the interstate and how much it was going to cost to publish a McDonald's or a Burger King sign on the interstate. We went from, like, $200 a sign to $2,000 a sign to raise money for our state in a way that was consistent with the what the market had done over the ensuing years.
And let's see -- with regards to my health care plan, you know, a lot of people talk about health care. I'm the only one that got the job done.
I got health insurance for all our citizens. We had 460,000 people without insurance. We got 300 of them -- 300,000 of them signed up for insurance now. I'm proud of what we accomplished.
The bill that I submitted to the legislature didn't cost $1 more than what we were already spending. However, the legislature and now the new Democratic governor have added some bells and whistles, and they're willing to pay for them.
I wouldn't do that if I were governor. I would veto the items they put in place there, but they're entitled to make changes if they want to.
They're still running a balanced budget. I wouldn't have added the money they did. And by the way, no debt was left. I left a rainy day fund of over $2 billion.
Facts are stubborn things. I'm proud of my record.
...
JIM VANDEHEI, POLITICO: The first question from the readers, Governor Romney, is from Jonathan Rubin (ph) in Fairfax, Virginia.
"As governor of Massachusetts, Senator McCain just pointed out you raised hundreds of millions of dollars in additional revenue through so-called fees and loophole closings. You passed a health care bill forcing individuals to buy insurance on the threat of a fine. How do you reconcile that policy with your claim to be the authentic conservative?"
ROMNEY: Well, let's talk about each.
I mentioned fees, and I think it's appropriate if the state is providing a service to someone that's not a requirement to have a car or a driver's license, but instead, let's say, we're going to be taking out an oil tank from your back yard because it's leaking into the ground and the state's going to provide that service. But to charge a fee sufficient to do so makes a lot of sense.
And so the fees ought to be adjusted from time to time to compose the amount of what the cost is of providing that service. And if there hasn't been a fee raised in a couple of decades, you probably have some inflation in there you ought to adjust for.
Florida Debate
In January of 2008, Governor Romney participated in the Presidential debate in Boca Raton, Florida. When asked about the Bush tax cuts, Governor Romney stated that he did support them when they passed and that he would support making them permanent.
Russert: Governor Romney, you've criticized Senator McCain for opposing the first two Bush tax cuts. You've criticized Mayor Giuliani for going to court to try to retain a commuter tax on people coming to the city of New York.
Do you trust Senator McCain and Mayor Giuliani on the issue of being tax cutters?
Romney: I trust these two gentlemen and I respect them greatly. We do have differing views and over time our record with regards to taxes has been somewhat different.
But I think all of us on this stage want to see taxes brought down and want to see spending brought down. I have a sound record of doing that. I came into a state that faced an extraordinary series of challenges.
Massachusetts was in a ditch. We had about a $3 billion budget shortfall. Everybody thought we're going to have to raise taxes to solve the problem.
And I went to work to get Massachusetts back on track. Working with Democrats across the aisle, we were able to do that without raising taxes. And that was critical, because it said to the business community "You don't have to worry about Taxachusetts coming back again. You're going to see Massachusetts live within its means."
We balanced the budget every one of four years. We also put in place a surplus of over $2 billion to help make sure that we have the kind of resources that would be needed if there were a rainy day.
Now, I also support the Bush tax cuts. Senator McCain voted against them originally. He now believes they should be made permanent. I'm glad he agrees they should be made permanent.
I think he should have voted for them the first time around and that's just a difference of viewpoints. The Bush tax cuts helped get our economy going again when we faced the last tough times, and that's why right now, as we face tough times, we need to have somebody who understands -- if you will, has the private sector, has the business world, has the economy in their DNA.
I do. I spent my life in the private sector. I know how jobs come and I know how they go and I'll make sure that we create more good jobs for this nation. And one way to do that is by holding down taxes and making those tax cuts permanent.
New Hampshire Debate
In January of 2008, Governor Romney participated in the Presidential debate in New Hampshire. He states that Democrats would raise taxes while he would lower them and he reasserts his views that tax rates on capital gains and dividends should be lowered.
WALLACE: Governor Romney, you have taken the pledge.
WALLACE: You like to say that you don't just talk about pledges, that, in fact, you actually had to operate one as government of Massachusetts. But according to the National Conference of State Legislatures, in your first year as governor, you raised fees and fines by $500 million, including fees paid by the blind, by gun owners, by those seeking training against domestic violence, and even by used car shoppers. In fact, the Associated Press says you earned a nickname back then in Massachusetts. It was "Fee-fee".
(LAUGHTER)
How do you respond, sir?
ROMNEY: Well, that's the first I've ever heard that, Chris, but it's pretty good -- as a matter of fact, a little exaggeration. The total fees raised were $260 million, and that's a big number. We had a $3 billion budget gap. The Democrats -- you probably know that Massachusetts is a bit of a Democratic state -- the Democrats wanted to raise taxes. I said, "No way." And in fact we did not raise taxes on our citizens, and we lowered them across that state time and again. We put an investment tax credit permanently in place. We provided help to senior citizens on real estate taxes. We changed the capital gains tax increase to a capital gains tax refund.
ROMNEY: I'm proud of what we were able to do to lower taxes. I'm also going to lower taxes for the American people, and that's the key thing. Right now, you can listen to the Democrats. Their pledge is clear. They're going to raise taxes. I want to lower them. Make the Bush tax cuts permanent. Kill the death tax once and for all.
(APPLAUSE)
And a savings plan -- a savings plan for middle income Americans. If you earn less than $200,000 a year, the new tax rate on interest, dividends and capital gains ought to be absolutely zero. And by the way...
(APPLAUSE)
... John Edwards has his own savings plan for the middle class. He says you can save $250 a year tax-free. Whoopty-doo. That's not going to buy you retirement, it's not going to buy you a house, and someone yelled out it's not going to buy him a haircut, either.
Campaign Commercial
One of Governor Romney's 2008 campaign commercials dealt exclusively with taxes. Governor Romney pledged to end the estate tax, roll back all tax rates, and remove taxes on interest, dividends, and capital gains.
ATR Pledge
While running for the Presidency in 2008, Governor Romney signed the taxpayer protection pledge. This pledge simply stated that he would not raise the marginal rates for individuals and/or businesses, and that he would oppose any net reduction or elimination of deductions and credits, unless matched dollar for dollar by further reducing tax rates.
2008 Economic Plan
In January of 2008, Governor Romney put forth an economic plan as part of his 2008 Presidential campaign. The plan consisted of tax reform for individuals and businesses, and relief for homeowners.
Individuals
Permanently Reduce The Lowest Income Tax Bracket to 7.5%
Permanently Eliminate Payroll Taxes On Employees Over The Age Of 65
Make Middle-Class Savings Tax Free
Make the Bush Tax Cuts permanent
End the Death Tax
Patch or permanently end the AMT
Make The Research And Development Tax Credit Permanent
Oppose Any Increase In Social Security Taxes
Business
Institute Immediate 100% Expensing Of New Equipment Purchased By A Business For A Two-Year Period Retroactive To January 1, 2008
Reduce The Corporate Tax Rate To 20% Over Two Years
Homeowners
Reform And Expand Federal Housing Administration (FHA) Loan Portfolio Limits
STRATEGY FOR A STRONGER AMERICA : THE ROMNEY ECONOMIC STIMULUS PLAN
Governor Romney's Economic Stimulus Plan – Washington Must Act Now:
Governor Romney's Economic Stimulus Plan Would Provide Much-Needed Relief To Taxpayers, Businesses And Homeowners. Today, our economy is facing unprecedented challenges both here at home and abroad. Our economy needs pro-growth stimulus, but Governor Romney believes any stimulus package should return money to American taxpayers, not increase already out-of-control government spending. To promote economic growth, Governor Romney is proposing an economic stimulus plan that would lower taxes on individuals, reduce taxes for businesses and help homeowners through the current housing crisis.
Individuals: Governor Romney would permanently reduce the lowest income tax bracket, permanently eliminate payroll taxes on seniors and make middle-class savings tax free.
Businesses: Governor Romney would institute immediate 100% expensing of equipment for two years and permanently reduce the corporate tax rate.
Homeowners: Governor Romney would reform and expand Federal Housing Administration (FHA) loan portfolio limits to allow larger loans to homeowners.
Governor Romney Urges Our Leaders To Work Together And Immediately Debate, Pass And Sign A Stimulus Package For The American People. If our representatives in Washington can work together and demonstrate the leadership that the American people deserve, Governor Romney is optimistic that we can still turn this economy around. Washington must get to work immediately and pass a bill no later than February 19, a month from today, in order to stimulate our economy.
INDIVIDUALS: Governor Romney's Economic Stimulus Plan – Pro-Growth Tax Cuts For Individual Taxpayers:
Permanently Reduce The Lowest Income Tax Bracket to 7.5%. Permanently cutting taxes for all taxpayers will put more money in workers' pockets and stimulate consumer confidence and spending.
Cutting The Lowest Tax Rate From 10% To 7.5% Will Provide Up To A $400 Tax Cut To Each American Taxpayer.
Governor Romney Proposes Providing An Immediate Retroactive Tax Credit Reflecting The Lower 7.5% Tax Rate For 2007 Earnings To Employees Who Earned Less Than $97,500 In 2007. This tax cut would immediately stimulate the economy as taxpayers with the highest propensity to consume receive their increased 2007 tax refunds.
Permanently Reducing The Lowest Bracket Is A Pro-Growth Tax Cut For The Tens Of Millions Of Americans In The Lowest Income Tax Bracket.
Permanently Eliminate Payroll Taxes On Employees Over The Age Of 65. It is not fair that seniors that have worked their whole life and earned their full Social Security benefit continue to owe payroll taxes to the federal government.
In This Uncertain Economic Environment, More And More Seniors Are Returning To The Workforce. Governor Romney's proposal will provide an immediate tax cut to working seniors.
Governor Romney Believes That Seniors Have Already Earned Their Full Social Security Benefit And Should Not Owe Additional Payroll Taxes For Income Earned After Age 65.
Make Middle-Class Savings Tax Free. Governor Romney's plan will allow middle class Americans to save tax free by changing the tax rate on interest, capital gains and dividends to absolutely 0%. By helping more Americans save and invest, we can meet the challenges of an aging population and ensure the financial security of America .
Allow Over 95% Of American Families To Save And Invest Tax Free: Any taxpayer with Adjusted Gross Income under $200,000 would pay a tax rate of absolutely 0% on all of the income they earn from their savings, capital gains and dividends.
Expand The Investor Class: In recent years, over half of adult Americans have participated in the stock market either directly or through pension plans and mutual funds. Tax-free savings will encourage more families to build wealth by saving, investing and participating in the stock market, which will help grow the economy.
BUSINESSES: Governor Romney's Economic Stimulus Plan – Pro-Growth Tax Cuts For Businesses:
Institute Immediate 100% Expensing Of New Equipment Purchased By A Business For A Two-Year Period Retroactive To January 1, 2008. This plan would allow both large and small businesses to immediately invest in new equipment and capital improvements, which would immediately stimulate the economy and create new jobs.
Boost U.S. Manufacturers And Vendors: Accelerating and increasing capital investment in equipment and other qualified assets in the U.S. will immediately provide a boost to U.S. manufacturers and vendors.
Encourage Additional Business Investment: Entrepreneurs and small businesses, such as S corps and LLCs, which often face cash flow difficulties, will benefit greatly by the reduced cost of investment in equipment under this plan. Additional investment and expansion by these growing businesses will drive economic growth.
Reduce The Corporate Tax Rate To 20% Over Two Years. Governor Romney believes we should immediately act to reduce the corporate rate to 25% for 2008 and 20% in 2009. A permanent U.S. corporate tax rate of 20% will attract capital, stimulate investment, and increase American competitiveness with the rapidly growing economies of the world.
A More Competitive Corporate Tax Rate: Governor Romney has spoken throughout the campaign about the need to reduce our corporate income tax rate in order to compete more effectively against other countries with lower rates. The United States currently has the second-highest corporate tax rate in the Organization for Economic Co-operation and Development.
Encourage New Capital Flows Into The United States : Cutting the corporate tax rate will cause new capital to flow to the U.S. and make our U.S. companies more competitive by providing additional funds for research, development, innovation, and hiring of additional employees.
HOMEOWNERS: Governor Romney's Economic Stimulus Plan – Helping Homeowners:
Reform And Expand Federal Housing Administration (FHA) Loan Portfolio Limits:
Lower The Amount Of Upfront Down Payment A Borrower Must Make, Allowing FHA To Help Nonprime Borrowers Who May Not Be Able To Meet The Current Requirement.
Raise The Maximum Loan Amount Eligible For FHA Insurance, Allowing FHA To Serve More Borrowers In Higher-Priced Areas.
Expand NeighborWorks America 's Foreclosure Avoidance Initiative: Governor Romney proposes expanding NeighborWorks America 's Foreclosure Avoidance Initiative to help American homeowners stay in their homes. NeighborWorks America assists homeowners by offering foreclosure counseling and identifying refinancing opportunities for U.S. homeowners.
Governor Romney's Pro-Growth Tax Agenda:
Governor Romney's Economic Stimulus Plan Is In Addition To His Tax Proposals Which Will Provide A Sound Economic Framework For Long-Term Growth:
Make The Bush Tax Cuts Permanent: Making the Bush Tax Cuts permanent is the first step to ensuring that Americans are able to keep more of their hard-earned money.
Roll Back Tax Rates For All Americans: As President, Governor Romney will cut marginal tax rates across the board, allowing all Americans to save more money.
Kill The Death Tax: It is unfair to tax Americans three times: first when they earn their money; second when they invest it and receive income from those investments; and third when they die.
Make The Research And Development Tax Credit Permanent To Encourage Capital Investment And Innovation: Governor Romney believes that we must encourage companies to invest more in research and development to produce the innovations our companies need to win in the global economic competition.
Oppose Any Increase In Social Security Taxes: We can strengthen Social Security without resorting to higher Social Security taxes that will impact all Americans. Governor Romney will oppose any proposed increase in Social Security. taxes.
Prevent The Alternative Minimum Tax (AMT) From Hurting More American Families: At the very least, Congress must pass a patch to the AMT that will prevent this tax from affecting more and more families in America.
Tax Deal, Bad Deal
In December of 2010, Governor Romney wrote an op-ed in USA Today in which he stated that the recently struck deal to extend the Bush tax cuts along with unemployment benefits was a bad deal because the temporary extension of lower taxes only adds uncertainty.
Mitt Romney: Tax deal, bad deal
Death and taxes, it is said, are life's only two certainties. But in the wake of President Obama's tax compromise with congressional Republicans, only death retains the status of certainty: The future for taxes has been left up in the air. And uncertainty is not a friend of investment, growth and job creation.
The deal has several key features. It reduces payroll taxes, extends unemployment benefits and keeps current tax rates intact. So far, so good. But intermixed with the benefits are considerable costs of consequence. Given the unambiguous message that the American people sent to Washington in November, it is difficult to understand how our political leaders could have reached such a disappointing agreement. The new, more conservative Congress should reach a better solution.
The deal keeps current tax rates from rising to pre-Bush era levels for two years. But in 2013, unless Congress acts again, rates will increase dramatically.
Extension temporary
Of course, delay now is better than an immediate tax hike. But because the extension is only temporary, a large portion of the investment and job growth that characteristically accompanies low taxes will be lost. When entrepreneurs and employers make decisions to start or expand an enterprise, uncertainty about tax rates translates directly into a reduced propensity to invest and to hire. With only a two-year extension, investors know that before their returns are realized, tax rates may be jacked up to the levels favored by President Obama. So while the tax deal will succeed in temporarily putting more money in the hands of consumers, it will fail to deliver its full potential for creating lasting growth.
It will also add to the deficit. In many cases, lowering taxes can actually increase government revenues. If new businesses, new investments and new hiring are spurred by the prospects of better after-tax returns, the taxes paid by these new or growing businesses and employees can more than make up for the lower rates of taxation. But once again, because the tax deal is temporary, a large portion of this beneficent effect is missing. What some are calling a grand compromise is not grand at all, except in its price tag. The total package will cost nearly $1 trillion, resulting in substantial new borrowing at a time when we are already drowning in red ink.
Part of the tax deal is a temporary reduction in payroll taxes. The president was insistent, however, that only the employee's payroll taxes be reduced — the portion paid by the employer is to remain the same. Again, the president is looking to get more money into the hands of the consumer to boost near-term spending. But by refusing to lower the cost of hiring a new employee, he fails to encourage what the American people want even more than lower taxes — more good jobs. Like the income tax deal, the payroll tax deal will add to the deficit.
For those without jobs, the tax compromise extends unemployment benefits for 13 months. A decent and humane society must have a strong safety net for the unemployed. I served for 15 years as a lay pastor in my church and saw the heartbreak of joblessness up close; a shattering loss of faith in oneself is but only one of many forms the suffering can take. Nonetheless, the vital necessity of providing for those without work should not be used as an excuse to ignore the very real problems of our unemployment system.
In this, as in so many other arenas of government policy, unemployment insurance has many unintended effects. The indisputable fact is that unemployment benefits, despite a web of regulations, actually serve to discourage some individuals from taking jobs, especially when the benefits extend across years.
Iowa Debate
In August of 2011, Governor Romney participated in the Republican debate in Ames, Iowa. He was asked about raising taxes in Iowa and stated that he never saw a reason to raise taxes.
YORK: Thank you, Bret. We're going to start with Governor Romney.
Governor, in 2005, when you were the governor of Massachusetts, you successfully appealed to Standard & Poor's to upgrade your state's credit rating. You said you used a combination of spending cuts and new revenues to put Massachusetts on a more sound financial footing. You even approvingly cited a tax increase passed by the Democratic state legislature.
YORK: Doesn't this show that sometimes raising taxes is necessary?
ROMNEY: No. I don't believe in raising taxes. And as governor I cut taxes 19 times and didn't raise taxes. Let's step back and talk about the first part what you said. I was fortunate enough to be a governor that got an increase in the credit rating in my state. At the same time we got a president who got a decrease in the credit rating of our nation. And that's because our president simply doesn't understand how to lead and how to grow an economy.
I was very proud of the fact that Republicans and Democrats worked together in Massachusetts to cut spending. I came in, we had a huge deficit. I went to the legislature and I said I want expanded powers to unilaterally be able to cut spending not just slow the rate of growth but to cut spending and they gave it to me and I did. We cut spending.
Every single year I was governor we balanced the budget. And by the end of my term we had put in place over a two billion dollar rainy day fund. That kind of leadership is what allowed us to get a credit upgrade from Standard & Poor's. And that's the leadership we finally need in the White House.
Reagan Debate
In September of 2011, Governor Romney participated in the Republican debate at the Reagan debate. He talks about his general tax policy, and his plan to allow those making less than $200,000 to save their money tax free.
ROMNEY: You know, I must admit, I have a bit of a hard time with the idea that there are people who don't feel like they're supporting our troops by contributing tax revenue through -- through the income tax or through other tax vehicles.
I don't want to raise taxes on the American people, but I think everybody ought to feel that they're part of this effort and that they're providing for our military, providing for our roads, providing for our schools. That ought to be part of what -- what every American experiences.
But right now, the question is not the people at the -- that are not paying taxes at the low end. The question is not the people who are very, very rich. The question is, how about middle-income Americans?
Who are the people most hurt by the Obama economy? And the answer is the middle class. The great majority of Americans are having a very, very difficult time. And our effort has to be to find ways to reduce to burden on those people.
And that's why I've proposed that anybody who's earning $200,000 a year and less ought to be able to save their money tax-free, no tax on interest, dividends, or capital gains. Let people save their money, invest in America, and not have to give more money to the government. The middle class needs our help.
TEA Party Debate
In September of 2011, Governor Romney participated in the TEA Party debate and was asked about the whether or not he supports the FAIR Tax. He states that while the system has a lot going for it, it is flawed in that it disproportionately affects lower income earners.
QUESTION: Hello. My question is, would any of you be willing to support the fair tax?
BLITZER: Governor Romney? A fair tax basically is a national sales tax.
ROMNEY: Yeah. Yeah. The -- the idea of a national sales tax or a consumption tax has a lot to go for it. One, it would make us more competitive globally, as we send products around the world, because under the provisions of the World Trade Organization, you can reimburse that to an exporter. We can't reimburse our taxes right now. It also would level the playing field in the country, making sure everybody is paying some part of their fair share. But the way the fair tax has been structured, it has a real problem and that is it lowers the burden on the very highest income folks and the very lowest and raises it on middle income people. And the people who have been hurt most by the Obama-economy are the middle class.
And so my plan is to take the middle class individuals and dramatically reduce their taxes by the following measure. And that is for middle income Americans, no tax on interest, dividends or capital gains. Let people save their money as the way they think is best for them, for their kids, for their future, for their retirement. We're taxing too much, we're spending too much and middle income Americans need a break and I'll give it to them.
Believe in America Plan
On September 6, 2011, Governor Romney came out with his Believe in America economic plan. The 160 page plan had a 5 page summary. Governor Romney's plan consists of 5 bills that he would call for upon assuming office, and 5 executive orders that he would give after assuming office. These bills would include lowering the corporate income tax rate, implement free trade agreements, greater domestic energy production, cut non-security discretionary spending by 5 percent, and return retraining programs to the states.
The five orders that Governor Romney would issue on his first day as President would be the ending of Obamacare, a reduction in regulation started by President Obama, rapid issuance of drilling permits to developers with established safety records, sanctions on China for unfair trade policies, and reversing unfair labor practices put in place by President Obama.
Tax Policy
Individual Taxes
Maintain marginal rates at current levels
Further reduce taxes on savings and investment
eliminate the death tax
Long term goal - pursue a flatter, fairer, simpler structure
Corporate Taxes
Lower the corporate income tax rate to 25%
Transition to a "territorial" tax system
Regulatory Policy
Repeal and replace Obamacare and Dodd-Frank
Review and eliminate Obama-era regulations
Cap new regulatory costs at zero dollars
Require Congress to approve all major regulations
Reform legal liability system
Trade Policy
EXPANDED MARKETS
Implement pending Free Trade Agreements
Conclude Trans-Pacific Partnership and pursue additional agreements
Create Reagan Economic Zone
CONFRONTING CHINA
Increase enforcement of existing law
Impose punitive measures if unfair trade practices continue
Energy Policy
SIGNIFICANT REGULATORY REFORM
Streamline and fast-track approval processes
Amend Clean Air Act to exclude regulation of carbon
INCREASED PRODUCTION
Conduct comprehensive survey of the nation’s reserves
Open reserves to exploration and production
RESEARCH AND DEVELOPMENT
Focus investment in basic research
Utilize DARPA-like funding mechanisms
Labor Policy
Appoint experienced and even-handed arbiters to the NLRB
Guarantee businesses the right to allocate capital as they choose
Protect right of workers to choose whether to unionize
End funding of union political campaigns through paycheck deductions
Human Capital Policy
RETRAINING WORKERS
Consolidate unwieldy sprawl of federal programs
Return authority, responsibility, and funds to states for retraining programs
Support private-sector participation in the process
THE BEST AND THE BRIGHTEST
Raise visa caps for highly skilled foreign workers
Give permanent residency to eligible advanced-degree recipients
Fiscal Policy
Cut federal spending and cap it at 20 percent of GDP
Block grant Medicaid and pursue further entitlement reform
Reduce the federal workforce
Restructure the federal government
Pursue a Balanced Budget Amendment
Day One Job One
When Mitt Romney says that fostering job creation through economic growth will be his top priority from his first day in office, he means it. While some elements of his plan will take time to set in motion, much can be done from a running start. On Inauguration Day, he will submit a jobs package to Congress consisting of at least five major proposals and will demand that Congress act on the package within 30 days, using every power at his disposal to ensure its passage. He will also take immediate and specific steps within his sole authority as president by issuing a series of executive orders that gets the U.S. government out o f the economy’s way. The goal: restore America to the path of robust economic growth necessary to create jobs.
FIVE BILLS FOR DAY ONE
The American Competitiveness Act
Reduces the corporate income tax rate to 25 percent
The Open Markets Act
Implements the Colombia, Panama, and South Korea Free Trade Agreements
The Domestic Energy Act
Directs the Department of the Interior to undertake a comprehensive survey of American energy reserves in partnership with exploration companies and initiates leasing in all areas currently approved for exploration
The Retraining Reform Act
Consolidates the sprawl of federal retraining programs and returns funding and responsibility for these programs to the states
The Down Payment on Fiscal Sanity Act
Immediately cuts non-security discretionary spending by 5 percent, reducing the annual federal budget by $20 billion
FIVE EXECUTIVE ORDERS FOR DAY ONE
An Order to Pave the Way to End Obamacare
Directs the Secretary of Health and Human Services and all relevant federal officials to return the maximum possible authority to the states to innovate and design health care solutions that work best for them
An Order to Cut Red Tape
Directs all agencies to immediately initiate the elimination of Obama-era regulations that unduly burden the economy or job creation, and then caps annual increases in regulatory costs at zero dollars
An Order to Boost Domestic Energy Production
Directs the Department of the Interior to implement a process for rapid issuance of drilling permits to developers with established safety records seeking to use pre-approved techniques in pre-approved areas
An Order to Sanction China for Unfair Trade Practices
Directs the Department of the Treasury to list China as a currency manipulator in its biannual report and directs the Department of Commerce to assess countervailing duties on Chinese imports if China does not quickly move to float its currency
An Order to Empower American Businesses and Workers
Reverses the executive orders issued by President Obama that tilt the playing field in favor of organized labor, including the one encouraging the use of union labor on major government construction projects
Mitt Romney's PLan for Jobs and Economic Growth
The book released by the campaign underscores President Obama’s failed approach to each policy area crucial to turning around the economy, and lays out precisely how Mitt Romney will address the issues as president
TAX POLICY
Mitt Romney will push for a fundamental redesign of our tax system. He recognizes the need to simplify the system. He also recognizes the need both to lower rates and to broaden the tax base so that taxation becomes an instrument for promoting economic growth. As president, Romney will hold the line on individual income tax rates and eliminate taxes on interest, dividends, and capital gains for low- and middle-income taxpayers. He will eliminate the estate tax. And he will pursue a conservative overhaul that applies lower and flatter rates to a broader tax base.Romney will also reform the corporate tax system. He will immediately lowe rthe corporate income tax rate, and then explore opportunities to further lower the marginal rate while broadening the tax base. He will also begin the process for transitioning to a territorial corporate tax system. A territorial system must be designed to encourage multinational companies to bring their profits back into the U.S. and it must avoid the creation of incentives for outsourcing.
