Romney's plan would cost the government about $5 trillion in forgone revenue over the next decade on top of the cost of extending the income tax cuts now scheduled to expire Dec. 31. Romney hasn't specified which tax breaks he would limit.
The Bowles-Simpson plan would cut the top tax rates on individuals and corporations to 28 percent. It would limit tax breaks for mortgages, charitable contributions and health insurance without eliminating them. Bowles is a Democrat who was chief of staff to President Bill Clinton. Simpson is a Republican former senator from Wyoming.
Unlike Romney, Bowles and Simpson include two features that would raise taxes for high-income or wealthy taxpayers. They would treat capital gains and dividends as ordinary income. They also would assume that the estate tax continues with a top rate of 45 percent.
Deficit reduction should take place over 15 years so that it doesn't slow down the economy, Bowles said.
"What they tried to do in the U.K. was to do it really quickly, trying to get it, you know, to a balanced budget within five years," he said. "We have it over a much longer period of time, so we don't disrupt this very fragile economic recovery."
Most Similar
In a memo released yesterday, the Obama campaign said its plan -- not Romney's -- was the one that most closely resembled the Simpson-Bowles plan.
"Despite his praise for the Simpson-Bowles approach, Romney's plans are fundamentally incompatible with it," wrote James Kvaal, the campaign's policy director.
Obama disagrees with the Simpson-Bowles plan's cuts to defense and Social Security, the memo said.
Bowles said he didn't expect Republicans to stick to their no-tax-increase pledge, particularly because the end-of-year fiscal cliff could throw the economy into recession.
"I'm not worried about it a bit, because I think you will see, as we get closer and closer to this fiscal cliff, you will see more and more Republicans come out and say, you know, we have to have some revenue," he said.