WASHINGTON: Mitt Romney’s idea to impose a $17,000 limit on taxpayer deductions would hit the wealthy the hardest. But that limit by itself wouldn’t fully make up for revenue lost in Romney’s plan to reduce all income tax rates by 20 percent.
Campaign officials say the ceiling on deductions is part of a three-pronged approach that Romney is considering. The idea is to limit tax breaks in order to pay for lower overall tax rates. Romney says his plan would reduce the top tax rate from 35 percent to 28.
The officials say Romney is also considering limits on the standard exemption that most taxpayers claim and the tax exclusion for employer-backed health insurance.
The officials spoke on condition of anonymity to discuss details of the plan that Romney hasn’t announced.