With tax plan, Mitt Romney tries to turn focus back to economy

Mitt Romney pledged Wednesday to slash all Americans’ tax rates by a fifth, as he tries to refocus the GOP presidential campaign on the economy hours before a crucial debate.

“I’m going to lower rates across the board for all Americans by 20%,” he told more than 1,000 people gathered in a school gymnasium in this suburb of Phoenix.

Romney said his plan would not add to the federal deficit because he would limit tax deductions and exemptions for the wealthy, though middle-class families would continue to be able to deduct mortgage interest and charitable contributions.

“For high-income folks, we are going to cut back on that so we make sure the top 1% keeps paying, paying the current share they’re paying or more,” Romney said. “We want middle-income Americans to be the place we focus our help, because its middle-income Americans that have been hurt by this Obama economy.”

The proposal comes as Romney is battling a surging Rick Santorum with key primaries taking place Tuesday in Michigan and Arizona, the site of a debate Wednesday evening. Santorum’s rise has prompted a focus on social issues, away from the economic difficulties that Romney, a former corporate chief, has staked his campaign on fixing.

Romney’s campaign also reiterated other planks in his tax-reform plan, such as cutting the corporate tax rate to 25%, that he had laid out previously.

“We’re going to lower our tax rates, we’re going to lower our spending and we’re going to preserve our long-term viability by fixing our entitlements, and that way we’re going to restore the American dream,” Romney said.

Romney said his proposed income tax cut would also benefit the 55% of Americans who work for companies that are taxed at an individual rate rather than a corporate rate. And he criticized President Obama’s plan, announced Wednesday, to reduce the corporate tax rate to 28% while eliminating tax breaks and changing interest deductibility.

“He’s proposing today a tax plan which I understand sounds like he’s lowering taxes but in fact he’s raising taxes, raising taxes on businesses by hundreds of millions of dollars,” Romney said. “Raising taxes will kill jobs. My plan will create jobs. That’s the difference between the two of us.”