Fact Check: Obama Ad Slams Romney's Tax Plan

By Steve Kanigher

Published 10/18 2012 06:05PM

Updated 10/19 2012 06:00AM

Claim: An advertisement endorsed by President Barack Obama that has aired on KLAS-TV Channel 8 features a portion of the first presidential debate between Democrat Obama and Republican nominee Mitt Romney. Romney states: "I'm not in favor of a $5 trillion tax cut. That's not my plan." NBC reporter Andrea Mitchell, acting as a fact checker, then states: "The nonpartisan Tax Policy Center concluded that Mitt Romney's tax plan would cost $4.8 trillion over 10 years." Narrator: "Why won't Romney level with us about his tax plan, which gives the wealthy huge new tax breaks. Because according to experts, he'd have to raise taxes on the middle class or increase the deficit to pay for it."

Verdict: Partially true and partially misleading. The Tax Policy Center, a collaboration of the Urban Institute and Brookings Institution think tanks, is sticking to its conclusion about the cost of Romney's tax plan and the negative impact the center says the plan will have on the middle class. The center has made a mathematical argument, based on what it knows of Romney's plan, that he cannot possibly fulfill all his promises without forcing middle-income earners to pay more taxes while wealthier Americans enjoy a windfall.

But Romney also is sticking to his claim that his plan wouldn't cost what the center or Obama campaign states. Romney's plan includes an across-the-board cut of 20 percent in marginal income tax rates and elimination of taxes on interest, dividends and capital gains for taxpayers with adjusted gross income below $200,000. He insists he will not raise taxes on the middle class. The study's authors conceded that they couldn't score Romney's plan directly because he hasn't specified which loopholes he would close or which deductions he would reduce or eliminate in his bid to broaden the tax base. Instead, Romney has referred to his plan as a set of tax reform principles he would use in dealing with Congress. There are simply too many unknowns to suggest that the center is automatically correct in its assumptions.

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