By Deanna C. White
Mitt Romney narrowly etched out a victory in Tuesday's hotly contested Michigan GOP primary, edging out Rick Santorum by a mere three percent margin. Also, as predicted, Romney easily defeated the competition in Arizona.
But while Romney managed to maintain his status as the GOP front-runner, there's little doubt the momentum Santorum built in Michigan in February means he still poses a threat to Romney's once all-but-certain ascendency to the Republican nomination going into the ten-state Super Tuesday primary Tuesday, March 6.
Perhaps that's why Romney, in a last-minute salvo to secure Michigan and possibly reposition the political discussion going into future primaries, attempted to shift the focus away from Santorum's political comfort zone, social issues, and the debate over true conservatism, back to the jobs and the economic front – even going so far as to label Santorum an "economic lightweight."
Santorum's economic, tax, and regulation policies were largely overlooked, or underplayed, at the start of the GOP campaign when Rick Perry's and Herman Cain's tax plans garnered much of the attention in early debates.
So where does Santorum stand on taxes and financial issues?
According to Santorum's official campaign site
, Santorum's overall economic plan hinges around his "First 100 Days Economic Freedom Agenda," a ten-point plan which includes, in part, promises to:
- Rein in spending by proposing spending cuts of $5 trillion over five years.
- Submit a budget to Congress that would balance the budget in four years.
- Present Congress a "pro-growth and pro-family" individual tax policy.
- "Restore America's competitiveness" by revamping the corporate tax code, pushing tort reform, and repealing Dodd-Frank.
Santorum's Tax Plan for Individuals
- Revive the American economy with a family-friendly tax code that would promote new incentives to reduce taxes for families by abolishing marriage tax penalties and tripling the personal deduction for each child.
- "Cut and simplify the current tax code" by cutting the current six tax brackets down to two brackets of 10 percent and 28 percent.
- Extend permanently all the 2001 to 2010 Bush-era tax cuts scheduled to expire in 2013.
- Eliminate the alternative minimum tax (AMT).
- Eliminate the death tax.
- Lower the capital gains and dividend tax rates to 12 percent to spur economic growth and investment.
- Retain deductions for charitable giving, home mortgage interest, health care, retirement savings, and children.
- Eliminate the cap on deductions for losses suffered in the sale of a principal residence.
Santorum's Corporate Tax Plan
- Slash the corporate income tax rate from 35 to 17.5 percent to make American businesses more competitive in the global market.
- Implement a zero tax rate for manufacturers to "spur middle income job creation in the United States and benefit from the job multiplier effect in manufacturing."
- Increase the research and development (R&D) tax credit from 14 percent to 20 percent, making the tax credit permanent.
- Eliminate the tax on repatriated taxable corporate income from 35 percent to 0 percent when manufacturers invest in plant and equipment.
- Reduce the corporate tax rate from 35 percent to 5.25 percent on other repatriated income.
- Allow for 100 percent expensing for new business equipment.
Urban Institute and Brookings Institute Tax Policy Center (TPC) Analysis of Santorum's Tax Plan
On January 18, the Urban Institute and Brookings Institute Tax Policy Center (TPC)
released an analysis of the Santorum tax plan. According to the TPC, its analysis "measures the change in tax liabilities against two alternative baselines: current law, which assumes that the 2001-2010 tax cuts all expire in 2013 as scheduled, and current policy, which assumes that the 2011 law is permanent (except for the one-year payroll tax cut and temporary investment incentives)."
Compared with the current law baseline, the TPC analysis found the Santorum plan would cut taxes for about 81 percent of taxpayers by an average of more than $9,700. Less than .5 percent of taxpayers would shoulder an average tax increase of approximately $175.
When comparing Santorum's plan to current policy, however, the TPC found approximately 1 percent of tax units would see their 2015 taxes go up an average of more than $200, while 69 percent would get tax cuts averaging nearly $7,800.
According to the TPC estimates: "The Santorum plan would lower federal tax liability by about $1.3 trillion in calendar year 2015 compared with current law, roughly a 40 percent cut in total projected revenue. Relative to a current policy baseline, the reduction in liability would be about $900 billion in calendar year 2015."
Committee for a Responsible Federal Budget Analysis of Santorum's Tax Plan
In its report, "Primary Numbers: The GOP Candidates and the National Debt
," the nonpartisan Committee for a Responsible Federal Budget states: "In total, we estimate the sum of [Santorum's] proposals would increase deficits by $4.5 trillion through 2021 under our intermediate-debt projections, resulting in 2021 debt levels at about 104 percent of GDP."