Romney, Obama release dueling tax overhaul proposals

Mitt Romney and President Obama released dueling tax overhaul proposals on Wednesday, touching off a fresh election-year debate over the federal deficit and the taxes paid by wealthy individuals and companies.

Romney proposed slashing individual income rates across the board by 20 percent, to lower the top tax rate to 28 percent from 35 percent, as part of a broad attempt at a policy reboot this week aimed at winning over his party’s conservative base.

Romney’s plan would cut all existing tax brackets by the same proportion, including cutting the lowest rate to 8 percent from 10 percent, and limit deductions for higher earners. Romney would also abolish estate taxes and the alternative minimum tax, and lower the corporate tax rate from 35 percent to 25 percent.

Romney unveiled details of his proposal hours after Obama set forth his own vision for a major overhaul of the nation’s corporate tax code. Obama’s plan would lower the nation’s corporate tax rate to 28 percent. And Obama would boost overall revenue from corporate taxation by banning numerous deductions and loopholes that save companies tens of billions of dollars a year on their tax bills.

The current U.S. corporate tax rate of 35 percent is one of the highest in the world, but the abundance of loopholes and deductions enables many businesses to pay far less than that — or nothing at all. Companies in the United States pay almost half the taxes that companies in other rich countries pay, compared with the size of the economy, according to the Organization for Economic Cooperation and Development.

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