Paul Sancya, Associated Press
WASHINGTON — The tax plan by Republican presidential candidate Rick Santorum would cut taxes for most Americans while swelling the federal budget deficit by $900 billion in a single year, according to an independent study.
About 69 percent of households would get tax cuts averaging nearly $7,800, according analysis by the Tax Policy Center, a Washington think tank.
Most of the tax cuts in Santorum's plan would go to the wealthiest households, according to the study. Those making more than $1 million would get tax cuts averaging nearly $442,000. Middle-income households making $50,000 to $75,000 would get tax cuts averaging about $2,062.
The price for the tax cuts is a staggering amount of debt at a time when Congress is struggling to rein in big budget deficits, said Roberton Williams, a senior fellow at the Tax Policy Center.
"These are huge numbers," he said.
Santorum, a former senator from Pennsylvania, has set a goal of cutting $5 trillion in federal spending over five years, according to his campaign website. However, Congress has been struggling to cut a fraction of that amount. Last summer, lawmakers couldn't agree on a plan to cut $1.2 trillion in spending over the course of a decade.
Santorum's plan would reduce the number of income tax brackets from six to two, lowering the top rate from 35 percent to 28 percent while keeping the bottom rate at 10 percent. He would cut the corporate income tax in half for most companies — lowering it from 35 percent to 17.5 percent. He would eliminate the corporate tax for manufacturers.
His plan would triple the exemption that parents can claim for dependent children, cut the top tax rate on investment income from 15 percent to 12 percent, and retain tax breaks for charitable donations, mortgage interest and retirement savings.
Williams said the big tax cuts for the wealthy come mostly from lowering the top income tax rate while cutting taxes on investment income and the corporate income tax.
Santorum's plan, outlined on his campaign website, says he would eliminate "marriage tax penalties throughout the federal tax code." That, however, could lead to tax increases for about 1 percent of filers, mainly single parents who currently file as heads of households, Williams said.
Santorum's campaign did not respond to a request for comment.
The Tax Policy Center is a research group formed by two Washington think tanks: the Urban Institute and the Brookings Institution. The center has analyzed the tax plans of all the major Republican candidates and found that all of them add to the budget deficit by promising big tax cuts.
The plan by former House Speaker Newt Gingrich would reduce revenues by $850 billion in a single year, and the plan by former Massachusetts Gov. Mitt Romney would reduce revenues by $180 billion, according to the analyses.
All of the projections are based on the taxes households would pay in 2015, presumably the first year a new president could get a plan fully implemented.
The campaigns of both Gingrich and Romney have said their tax plans would lead to economic growth, which would increase tax revenues over the long term. Santorum's website also says his tax plan would promote economic growth.
Williams said the analysis of Santorum's plan is based largely on an outline of the tax plan on Santorum's campaign website. He said the Tax Policy Center asked the Santorum campaign to clarify the details of the tax plan but didn't receive a detailed response.
- Security breached: Intruder gets into White...
- 'The Voice' returns Monday with Pharrell,...
- Tense hunt in trooper ambush case hits 8 days
- 11 best—and worst—state tax systems
- Second man arrested trying to enter White...
- After vote to stay in UK, Scots must heal divide
- Italian village honoring pilots of WWII US...
- Actress detained by police refuses to apologize
- Striking or spanking a child is not a... 19
- School police stock up on free military... 11
- Yellen says US families need to boost... 10
- Security breached: Intruder gets into... 8
- How much America wants to be taxed 8
- New Jersey loses 4th casino as Trump... 5
- Vikings place Adrian Peterson on exempt... 5
- US to assign 3,000 from US military to... 4