President Obama is considering whether to push early next year for an overhaul of the income tax code to lower rates and raise revenues in what would be his first major effort to begin addressing the long-term growth of the national debt.Not surprisingly, given the emphasis of the deficit commission, the administration's nascent tax planning focuses on reducing "tax expenditures," i.e. the huge array of targeted tax breaks such as the mortgage deduction or, say, College 529 plans. Doing so would enable increasing revenues while lowering rates. (Obama suggested that he would eventually want to do this with corporate tax rates way back in June 2008.)
The chief contribution of Obama's deficit commission was to demonstrate that there is at least some potential to get some Republicans to sign onto the idea of raising revenue while cutting rates by reducing expenditures. Conservative senators Tom Coburn and Michael Crapo voted for the plan.
What may defang the idea of raising revenue somewhat for at least some conservatives is the possibility of considering tax expenditures to be what the name suggests they are -- spending. As I noted while the commission's ideas were being floated, conservative commentator Heather MacDonald referred to cutting out tax breaks as cutting spending:
