Tax Policy Center: Ryan tax proposals need $5.7 trillion in offsets

Rep. Dave Camp (R-Mich.), the House Ways and Means chairman, and other Republicans on the tax-writing committee played a role in crafting the tax proposals, which are similar to what was in the last Ryan budget.

GOP lawmakers have vowed to make their tax overhaul revenue-neutral – meaning the rewrite wouldn’t bring in more revenue than the current system. Democrats, meanwhile, are pushing for more revenues to eat into current deficits.

But Howard Gleckman of the Tax Policy Center, a joint venture of The Urban Institute and the Brookings Institution, said it was “hard to imagine” that the tax plan in the GOP budget could be made revenue-neutral.

According to the TPC analysis, the tax cuts proposed in the Ryan budget, if not offset, would lower taxes for the middle 20 percent of taxpayers by around $900, and raise after-tax income by around 2 percent.

But the top 1 percent of households would pay more than $200,000 less and see a 17 percent hike in after-tax income.

Gleckman noted in a blog post that tax preferences become less valuable when tax rates are reduced, and that it would be politically difficult to get rid of many tax breaks.

“In the end, the Ryan budget is only half-a-plan,” Gleckman wrote.

“It outlines politically attractive tax cuts but says nothing about the tax increases necessary to pay for them. It leaves us with little more than a black box. The TPC numbers show just how big that box is.”

Democrats jumped on the TPC findings, saying it proved that the GOP continued to side with the wealthiest in the U.S.

“It moves in the opposite direction of the fiscal cliff deal at a time when income inequality continues its rapid rise in our nation,” Rep. Sandy Levin (Mich.), the top Democrat at House Ways and Means, said about the Ryan budget in a statement. “It would tie tax reform in knots.”

But Republicans brushed aside the tax center’s analysis, which comes months after the center questioned the math behind Mitt Romney’s tax plan – something President Obama quickly latched on to during last year’s campaign.

Romney himself called the TPC study “garbage.”

“They’re smoking something. We know the numbers work,” Rep. Kevin BradyKevin Patrick BradyGOP eyes limits on investor tax break Overnight Finance: White House requests B for disaster relief | Ex-Equifax chief grilled over stock sales | House panel approves B for border wall | Tax plan puts swing-state Republicans in tough spot Swing-seat Republicans squirm over GOP tax plan MORE (R-Texas), a senior Ways and Means member, told The Hill. “Not going to be easy. Very complex. Absolutely convinced we can do it.”