President Barack Obama and Republican presidential nominee and former Massachusetts Governor Mitt Romney met in a head-to-head debate for the first time last night at the University of Denver, kicking off a series of three presidential debates in the weeks leading up to the November 6 election. Gov. Romney appeared energetic and motivated on stage, aggressively challenging the President’s economic record and attempting to rise above the criticism that has grown more intense in the past two weeks. On the other hand, by most accounts, President Obama delivered an underwhelming performance. Although analysts and commentators quickly and emphatically declared Romney the Round 1 winner for both his polished arguments and delivery, it was the exposure of the rift between the candidates’ tax plans that commanded the most attention during the 90-minute ideological clash.
All Big Bird jokes aside, the tax discussion took on a serious and contentious tone, which culminated in the candidates overpowering moderator Jim Lehrer to get in a few extra minutes debating the topic. Although President Obama attempted to characterize Gov. Romney’s tax plan as a $5 trillion tax break for upper-income individuals, Romney firmly reiterated that his tax plan would increase revenues by increasing economic activity through lower tax rates for small businesses and the lower class. The President’s plan, Gov. Romney pointed out, threatens to raise taxes on small business owners that file their business taxes on their personal returns, punishing the entrepreneurs that are the engine of the American economy.
CNN Money published an article today explaining how the President’s tax plan, while attempting to tax upper-income Americans, has the unintended consequence of the tax hike for two of the upper-income brackets. Since more than 80 percent of franchise businesses file their business income on their personal income tax return, Obama’s proposal has the potential to raise taxes on franchise small business owners that are already burdened by tax uncertainty.
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