Romney’s economic advisor calls for tax hikes

For anyone yet stewing over Obama’s win, thinking, oh it could have been so different…
Mitt Romney’s former economic adviser Glenn Hubbard published an op-ed in the Financial Times Tuesday calling for higher tax rates on the wealthy and other taxes beyond that.

He wrote:

What should those negotiating the fiscal cliff do?

The first step is to raise average (not marginal) tax rates on upper-income taxpayers. Revenue increases should first come from these individuals. This means closing loopholes …Tax deductions should be scaled back, especially in the areas of mortgage interest, charitable giving and employer-provided health insurance.He didn’t stop there:

A strategy of ‘taxing the rich’ cannot pay for the entitlement state. If we wanted a larger government as a share of GDP, we would have to raise taxes substantially on everyone. Mr. Obama cannot argue that we can right the fiscal ship simply by taxing the rich.

He also suggested a VAT:

The present tax system can raise at most about 20 per cent of GDP in a booming economy. A government of, say, 25 per cent of GDP cannot be paid for by changing rates in such a system. The distortions would be too great. Rather, as in most other advanced economies, a universal consumption tax would be required.

via Robert Wenzel

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