Individual tax policiesRomney favors reducing individual tax rates. Romney proposes a "permanent, across-the-board 20 percent cut in marginal rates," according to his campaign Web site. If each personal tax rate is lowered by twenty percent, then Romney is proposing the following tax rate structure for personal incomes:
- Current tax rate: Proposed tax rate
- 10%: 8%
- 15%: 12%
- 25%: 20%
- 28%: 22.4%
- 33%: 26.4%
- 35%: 28%
Romney proposes eliminating taxes on interest, dividends and capital gains for persons earning less than $200,000 of adjusted gross income per year, and "maintain current tax rates" on these types of income for individuals making over $200,000. Presumably the implication to be drawn here is that Romney would keep the current 15% tax rate for qualified dividends and long-term gains.
Romney would eliminate the alternative minimum tax. Romney favors full repeal of the alternative minimum tax.
It's unclear at the moment how Romney intends to maintain budgetary balance while implementing his tax proposals. CNN reports that "the tax cuts will be offset by limits placed on deductions, exemptions and credits currently available to top-level income earners." However, details on which deductions and credits would be scaled back have not been released on Romney's campaign Web site.
Business tax proposalsRomney proposes reducing the corporate tax rate to 25%. Romney advocates reducing the top corporate tax rate to 25 percent. By comparison, Obama proposes changing the corporate rate to 28%. Additionally, Romney is is favor of
- Making permanent the research and development tax credit,
- Eliminating the corporate alternative minimum tax, and
- Switching from taxing worldwide income to a territorial-based tax system.
Estate tax proposalsRomney proposes to "eliminate the death tax," in other words, to repeal the estate tax.