Why bother cutting tax rates and closing loopholes if the end result is the same?
Seems like the process goes something like this:
So last year, your tax rate was x amount of dollars.
Congratulations, you're getting a 20% tax cut!
But we're getting rid of the mortgage interest deduction
and whatever other deductions you used to take.
Um, okay? So how much am I going to owe this year?
Hmm, let's see. . . . carry the one. . . divide by . . . aha!
This year your tax bill will be x-amount of daollars!
But that's exactly the same!
It's pronounced "revenue neutral."
Maybe Ryan can explain this better:
How much would it cost?" Wallace wondered. "The cut in tax rates.""It's revenue neutral... Lower all Americans' tax rates by 20 percent," Ryan replied.
"Right, how much will it cost?" Wallace pressed. "It's not revenue neutral unless you take away the deductions."
"I won't get into a baseline argument with you because that's what a lot of this is about," Ryan explained. "We're saying, limited deductions so you can lower tax rates for everybody.
But let me say it this way, you can lower tax rates by 20 percent across the board by closing loopholes and still have preferences for the middle class for things like charitable deductions, for home purchases, for health care. So what we're saying is, people are going to get lower tax rates."
So, besides the fact that he's completely full of shit, that there is no way that a 20% across-the-board tax cut can be revenue neutral, especially if you're preserving deductions for home purchases, charitable contributions, health care, etc, even if that were somehow magically true by the power of wishing really hard, what's the point? If the revenue is going to be the same, if, in other words, taxpayers are going to be paying the same, then why bother? And I haven't heard anyone in the media asking that question, so maybe it's just me that doesn't get it. But I kinda doubt it.