Mitt Romney Tax Reform Plan An Attempt To Regain Momentum

WASHINGTON -- Mitt Romney will release the details of a new tax reform plan on Wednesday, his campaign told The Huffington Post, as he tries to make up ground on Rick Santorum ahead of next Tuesday's primaries.

The plan will be released before Wednesday night's debate, giving Romney the opportunity to talk about it during the four-candidate event in Mesa, Ariz. And the former Massachusetts governor will then talk about the plan in his speech Friday at the Detroit Economic Club, his campaign told HuffPost.

Romney himself announced the coming plan during a town hall meeting in Shelby Township, Mich., on Tuesday.

"I'll be coming out with some proposals of my own this week that describe how I cut, create more pro-growth tax policies," Romney said. "I want to see a flatter, fairer, broader-based tax system."

The tax reform plan is a move by Romney to regain momentum, after watching Santorum, a former Pennsylvania senator, surge ahead of him in national polls as well as in Michigan. Romney has made up ground in recent days, but still trails.

The focus on policy is part of a strategy after Florida's Jan. 31 primary to do more than just negative campaigning, or at least to offset attacks on his opponents by a super PAC supporting Romney with policy substance and positive messages about the candidate.

In his comments Tuesday, Romney gave a nod to concerns that if a conservative is elected president, he will introduce austerity measures to bring down the debt that will hurt economic growth in the short term, as is happening in Greece.

"If you just cut, if all you're thinking about is just cutting spending, why as you cut spending you'll slow down the economy, so you have to at the same time create pro-growth tax policies," Romney said.

In the 153-page jobs plan that Romney's campaign released in September, there are 10 pages devoted to tax policy. Romney proposed then a series of measures: maintain the Bush tax cuts from 2001 and 2003 and make them permanent, "eliminate taxation on capital gains, dividends, and interest for any taxpayer with an adjusted gross income of under $200,000," eliminate the death tax, and "pursue a flatter, fairer, simpler structure."

It's this last portion, about how he would move to a simpler tax system, that Romney will expand on in his new proposal.

"You’ll see pro-growth tax reforms, coupled with more action on spending," Romney adviser Eric Fehrnstrom said in an email.

Romney previewed some of what he may talk about when he attacked President Barack Obama's plan to raise taxes on those making more than $250,000 a year.

"Over half the workers in America work for businesses that are taxed at the individual tax rate," Romney said at the town hall meeting. "So if someone owns, let's say a taxi cab company, the owner of that company doesn’t pay corporate in some cases. They instead pay personal tax on their companies' success. So if you raise taxes on anybody in America, you're going to end up depressing job creators."

Romney also in September proposed lowering the corporate tax rate from 35 percent to 25 percent, and suggested moving to a territorial tax system so that corporate profits are not taxed in the U.S. if they were already taxed abroad.

Of the corporate rate, the Romney campaign jobs plan booklet said that "worries that a lower corporate tax rate are unfair or unaffordable are fundamentally misplaced."

"The truth is, as Mitt Romney likes to say, 'corporations are people.' They represent human beings acting cooperatively to be economically productive," the campaign said, doubling down on Romney's infamous comment. "High corporate tax rates do not even accomplish what they are intended to accomplish. Studies of the American tax system have demonstrated that higher corporate rates do not necessarily lead to higher revenues."

The news of Romney's tax reform plan came as Sen. Tom Coburn, (R-Okla.), a member of the Senate Budget Committee, issued a call for Republicans to be bolder with their tax plans.

"The fact that Congress has not reformed the tax code in 25 years -- since Reagan’s historic 1986 reform -- is a disgrace," Coburn wrote in the National Review.

Coburn said that Republicans should go big on tax reform to erase the gains Obama has made by outmaneuvering them on the payroll tax cut.

"A bold tax-reform proposal that wiped out today’s code could cut rates in half for millions of Americans and would transcend today’s small-ball debates about the payroll-tax cut and even the Bush tax cuts," he wrote. "The Simpson-Bowles proposal, which received bipartisan support, suggested lowering today’s rates of 15, 28, and 35 percent to 8, 14, and 23 percent. Reducing spending inside and outside the code could push rates even lower and would spur tremendous innovation and job creation."