Group: Rolling back tax breaks can raise as much revenue as rate hikes

Eliminating or limiting tax breaks could raise the same amount of revenue as raising tax rates on the highest earners, according to a new paper from a bipartisan group.

The Committee for a Responsible Federal Budget said Thursday that capping itemized deductions or limiting the combined value of tax breaks could equal the amount gained from allowing the Bush-era tax rates to expire for family incomes above $250,000. 

The group, which has pushed for a broad deficit deal, also said that reducing the top rate for itemized deductions, and then phasing them out for the wealthiest earners, would also work.

CRFB added that raising revenue by eliminating tax breaks is preferable to raising marginal rates.

President Obama and Democrats are pushing to allow current income tax rates on the highest earners to rise, after the president campaigned on the issue in his bid for a second term. 

Republicans have said they are open to getting revenue through loophole closures, but Democrats have said they are skeptical that method will raise the sort of money they’re looking for.

“The math tends not to work,” Obama said at his news conference on Thursday.

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