Romney suggests $17,000 cap on tax deductions
October 3rd, 2012
05:44 PM ET
10 years ago

Romney suggests $17,000 cap on tax deductions

(CNN) – Mitt Romney detailed with fresh specificity this week how he would pay for large tax cuts he's proposed for all Americans, though his campaign says the suggestions were merely options and not a firm look into what policies he would seek to enact as president.

In the interview with CNN affiliate KDVR on Monday, Romney began by offering the broad strokes of his tax plan that he's been touting for months: lowering rates for all Americans and limiting deductions for higher income tax payers.

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Pressed for more specifics, Romney detailed a plan which would cap tax deductions at $17,000.

"You could do something, for instance, as an option you could say everybody's going to get up to a $17,000 deduction, and you can use your charitable deduction, your home mortgage deduction, or others – a healthcare deduction, and you can fill that bucket, if you will, that $17,000 bucket that way. And higher income people might have a lower number," Romney said.

Those details are the first time the candidate has suggested such a plan, though in the interview with KDVR he did not specifically say he would push for such a measure as president.
He also offered another option he said could be achieved with Congress.

"You could do it by the same method that Bowles-Simpson did it which is limiting certain deductions, but that's the sort of thing you do with Congress," Romney said. "The key thing is bring down rates, broaden the base to encourage small business to hire more people."

Asked whether Romney was revealing a new part of his tax plan, Romney campaign spokeswoman Amanda Henneberg said the GOP nominee was offering only an example of how he would achieve his goals of cutting taxes on middle class Americans.

"Governor Romney's tax reform plan will jumpstart economic growth, cut the tax burden on the middle-class, and lower tax rates across-the-board," Henneberg wrote. "He will pursue revenue and distributional-neutrality in reforming the tax code. There are a range of policy options, and Gov. Romney referenced one illustrative example, to achieve these goals."

Romney's tax plan calls for 20% cuts to current Bush-era income tax rates, a repeal of the Alternative Minimum Tax and the estate tax, and a move to make investment income tax free for those earning less than $200,000.

To pay for the plan, Romney points to the deductions he would limit and other loopholes he would cut. However, he has long been vague on which provisions he would eliminate. Despite being pressed in multiple interviews to name specifics, Romney maintains he would negotiate those details with Congress. Citing his experience as governor, Romney recently stressed the importance of working "across the aisle" when it comes to outlining policy.

"You work together with them, but you don't hand them a complete document and say, "Here, take this or leave it." Look, leadership is not a take it or leave it thing. We've seen too much of that in Washington," Romney said in an interview with "60 Minutes" last week.

Democrats, however, point to a Tax Policy Center report released in August that determined Romney's plan would provide large tax cuts to the wealthiest Americans while increasing the tax burden on the lower and middle classes.

And after Romney made his comments Wednesday, Obama's campaign posted a response on its website saying Romney's $17,000 cap would mostly be taken up by health care deductions in a family of four, meaning little room was left for other claims.

"In fact, health premiums alone cost $15,745 this year, according to the Kaiser Family Foundation. So if a family started there, Romney's plan would instantly wipe out nearly all other deductions-including mortgages, charitable contributions, and state and local taxes," the website stated.

A spokesman with the president's re-election campaign said that while Romney's latest comments may signal some specifics about this tax plan, the GOP nominee's policies would still spark a hike in taxes.

"Regardless of the twists and turns, Governor Romney has never been able to explain how he will pay for his $5 trillion tax plan without raising middle-class taxes. In fact, today's proposal suggests a plan even more generous to high-income taxpayers than the Tax Policy Center assumed – because it only caps certain deductions rather than eliminating a broader set of deductions and exclusions entirely – and would thus require even larger tax increases on the middle class than previously understood," campaign spokesman Adam Fetcher said in a statement.

Filed under: 2012 • Mitt Romney • Taxes
soundoff (39 Responses)
  1. Milton K. Wiah

    I knew Mitt was going to change his position on this subject and he did.
    This means this guy wants the name to be president, all his policy will be made by
    likes of Norquest, Rush and Coutter.

    October 3, 2012 07:29 pm at 7:29 pm |
  2. Maybeline Orange #4

    Mr. "I am severely conservative" I would like to know how this benefits the average American earning 30k per year?

    October 3, 2012 07:34 pm at 7:34 pm |
  3. Pander Bear

    What's that noise? Oh, it's the sound of Mitt's multimillionaire donors closing their checkbooks.

    October 3, 2012 07:40 pm at 7:40 pm |
  4. mj

    It means that those making the money to support you will be limited on the amount of deductions claimed. Thus, they will pay much more in taxes to support you. Really simple.

    October 3, 2012 07:44 pm at 7:44 pm |
  5. Four and The Door

    Maybeline Orange #4
    Mr. "I am severely conservative" I would like to know how this benefits the average American earning 30k per year?
    What it means is that you get a 20% tax cut and it will be paid for by people who make more than you.

    October 3, 2012 07:51 pm at 7:51 pm |
  6. usualone

    The main way a middle class person would get ahead was taking deductions on his/house home mortgage interest. Other items added but even now one has to be very sick to take off health care off those expenses. Romney getting a tax raise automatically for millions of people with this limit. Also, people will probably give less to charities because this tax raise will mean they need those monies to pay for the additional taxes.

    October 3, 2012 07:59 pm at 7:59 pm |
  7. A Sane Person

    Wuhhh? ANOTHER tax plan with few details???

    Ohhh. COME ON!!! Are You Serious?

    October 3, 2012 08:08 pm at 8:08 pm |
  8. Kef14

    No increase of taxes is acceptable, including removing deductions. This is against the pledge all our conservatives signed. Mitt needs to figure out the tax break that is equivalent to 20% + reduced deductions and then just stick with that. Say a 4% tax break across the board (checkers are saying that this plan is still short ~1 trillion making up for the 5 trillion of loss with a 20% break).

    October 3, 2012 08:09 pm at 8:09 pm |
  9. A Sane Person

    Romney's message tonight.....

    We are going to lower your taxes, and to make up for those losses, we are going to raise taxes on the other guy....

    October 3, 2012 08:11 pm at 8:11 pm |
  10. Thomas

    @Four and The Door
    Citing his experience as governor, Romney recently stressed the importance of working "across the aisle" when it comes to outlining policy.
    You will never see Obama working "across the aisle". He burned his bridges with Republicans in 2009 and 2010 and cannot go back. He has set himself up forever as a partisan politician, regardless of what gets the job done for the nation. This is unfortunate, but true. Romney/ Ryan 2012.

    He burned his bridges with Republicans in 2009 and 2010 and cannot go back.. On the contrary those that wanted and did everything in there power to make him a one term President , only hurt the country and themselfes . They did nothing , wasting more time on distraction rather then doing there jobs. Why do they call them the do nothing Congress ?

    Let me give you a little inside info Four and The Door , you ether have water under the bridge , or you have bridge under water.

    I was going to let GW Bush use that line when he spoke to the People of New Orleans right after Hurricane Katrina.

    Little did I know , I was saving it for you !

    October 3, 2012 08:19 pm at 8:19 pm |
  11. ColoradoJoe

    So with this $17K bucket, if you have limited deductions, you are screwed. If you rent or own your home, no mortgage deduction here. If you are basically healthy no medical deductions. If you limited donations (because you don't make enough to donate) no deductions here. If your kids are grown up and moved out, no child deductions. Shall I go on? This is such a stupid idea.

    October 3, 2012 08:20 pm at 8:20 pm |
  12. David

    In other words Mitt has no idea how he will pay for his plan, you cannot call it a plan if all you have is tax cuts and a airy fairy wish that 12million jobs will be created by cutting taxes on the super wealthy. The mega corps have already proven that they are more than happy to either sit on the extra profits or use the money to invest in emerging markets.

    October 3, 2012 08:23 pm at 8:23 pm |
  13. DENNA

    I want to know if he is going to mess with the mortgage interest deduction. I want to know what else he and Lyan Ryan are planning and I DON'T want to wait until after the election. Him and his "trust me" reminds me of a high school boy trying to talk someone into something they don't want to do.

    October 3, 2012 08:26 pm at 8:26 pm |
  14. DENNA

    @ – Proud American

    Mitt Romney 2012
    Proud? Really. You are putting your faith in the biggest bamboozle artist I have seen since Sarah Palin. :-O

    October 3, 2012 08:29 pm at 8:29 pm |
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