What are your thoughts on the idea of a "blanket deduction"?

The Romney/Ryan ticket has proposed reducing income tax rates 20% and eliminating the capital gains tax in exchange for closing loopholes in the federal tax code and giving a "blanket deduction" of a certain amount to be negotiated with a new Congress after he takes office. I've heard, $15K, $17K and $25K; I imagine the amount would be that which would make the lowering of other tax rates revenue neutral.

In other words, you can deduct the interest on your mortgage, the interest on your student loans, your charitable giving, energy tax credits, whatever, only to a certain amount.

Frankly, I like it. It allows you to make the choice, rather than the government telling you what deductions you may or may not take. It takes the power away from the Federal government to mess around with the deductions to benefit certain voting groups or organizations over others.

It hasn't been discussed in here, so I was wondering what everyone thought of the idea?

 

I like the idea of lowering the tax rate and only allowing a set amount of deductions.

how is it a scam, Barfo? I call bullshit

 

Just curious as to how you come to that conclusion. Romney pays around 14% of what he makes in taxes because most of his income comes from capital gains. I am not aware of any proposal on the table from Romney to lower the capital gains tax rate. He wants to lower the income tax rates for everybody, but that doesn't impact capital gains rates. He also wants to cap deductions at something around $25,000 (or at least that's the example number he threw out at the last debate). He's said that he will keep the amount of total taxes paid by the top 5% at around the 60% of the total taxes collected that they now pay. So how does that equate to him paying 0%? Or am I missing something?

 

Romney has also discussed lowering the capital gains rate to zero. The amount paid by the wealthy would remain static through elimination of loopholes, which are a much bigger form of tax avoidance than capitol gains. For example, getting rid of things like variable pre-paid forward contracts, which allow people to cash in on actual capitol gains while reporting a paper loss.

 

Smells like some more neo-con bullshit

 

Going by his website, that's not a part of his official tax plan:

Individual Taxes
- Make permanent, across-the-board 20 percent cut in marginal rates
- 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
- Repeal the Alternative Minimum Tax (AMT)

Corporate Taxes:
- Cut the corporate rate to 25 percent
- Strengthen and make permanent the R&D tax credit
- Switch to a territorial tax system
- Repeal the corporate Alternative Minimum Tax (AMT)

http://www.mittromney.com/issues/tax

 

i wonder why he wouldnt put that on his website?

 

I haven't heard about reducing capital gains taxes to 0%. Where is that a serious policy proposal?

Anywho, I am strongly opposed to the idea.

It would be the Republicans ObamaCare. Something that if they did, they would cram through Congress over the very strong opposition of all (or nearly all Dems) that would be bitterly opposed and hated by a significant portion of the Dem base (and some Republican voters too) that would cost the Republicans dearly in the polls.

At a time of such high income and wealth disparity it is a bad idea that would stoke the flames of class warfare in our political environment. The blowback could be small - Dems retake Congress and reinstitute current rates - or could be large - Congress eliminates preferred investment rates entirely, and for good measure passes a "one-time" wealth tax, to pay down the debt of course.

 

How is that? He's said multiple times, and his website says it as well, that capital gains tax would be 0% for those making less than $200k. Does Romney make less than $200k?

 

If it maintains the approximate proportion of tax burden paid by the rich, what do you have against it?

 

I was incorrect and I apologize. It's no capital gains for those making less than $200K. Thanks for the corrections everyone.

 

http://taxprof.typepad.com/taxprof_...ction-cap-good-economics-better-politics.html

 

Romney pays 14% on gains from already fully-taxed income. That is with deductions and charity, by the way.

 

0% capital gains on those making less than $200k is a great idea. I am in that category now, yet we pay capital gains on our investments even when they aren't realized.

barfo has no fucking clue what he's talking about, yet again.