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Tax Deductions Need To Be Protected, Or You've Broken Your Oath, Says Rand Paul To GOP

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RAND PAUL TAX DEDUCTIONS
Sen. Rand Paul (R-Ky.) opposes raising new revenues through eliminating tax deductions, a recent GOP compromise during the ongoing negotiations over the fiscal cliff. (AP Photo/J. Scott Applewhite) | AP

Sen. Rand Paul (R-Ky.) had some words Wednesday for Republicans who have proposed to raise revenues by closing loopholes and eliminating deductions -- that's still a tax increase.

"The real problem, and the thing that we have to be very careful on, is there are people, including some people who took the pledge out there, who think, 'Oh I can get rid of deductions -- which is raising revenue -- and that doesn't count as a tax increase,'" Paul said Wednesday on The Sean Hannity Show.

Paul then claimed that any tax plan that raises new revenues would be just as harmful as raising the marginal rates.

"I think we need to be explicit that if you get rid of deductions only, [you get] $700 billion worth of new revenue --that's a tax increase, and it's equally as bad as raising rates because you're taking money out of the private sector and giving it to the nonproductive center or the counterproductive center, which is the government," he said.

His criticisms come as several key GOP leaders -- including Speaker John Boehner (R-Ohio) and Senate Minority Leader Mitch McConnell (R-Ky.) -- have allowed that they would be open to raising new revenues through eliminating deductions and closing loopholes as long as Democrats compromised on significant cuts to entitlement programs.

"We’ve been open to revenue by closing loopholes, as long as it’s tied to spending cuts and pro-growth tax reform thatdens the base and lowers rates," McConnell said on the Senate floor Tuesday. "So Republicans have stepped out of our comfort zone. We’ve been clear about what we’ll do and what we won’t."

Most Republicans refuse to raise the marginal tax rates, arguing that it would harm economic growth and cost jobs. Paul's position echoed that of anti-tax lobbyist Grover Norquist, who claims that any attempt to raise additional revenue from taxes, even if that means getting rid of agricultural subsidies, constitutes a tax hike and should be opposed.

"The people who would write the checks to the IRS [for] higher amounts -- they would recognize that what just happened to them is their taxes were raised," Norquist said Wednesday on The Sean Hannity show. "Any congressman or senator who voted to increase the tax burden by eliminating many deductions or credits would have to face an electorate and say, 'I didn't raise your taxes; I only eliminated your deductions and credits.' I don't think that would pass the laugh test."

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