Bob Corker said he'd accept a 10:1 ratio of cuts to revenue increases. | John Shinkle/POLITICO GOP softens anti-tax rhetoric

Cracks are emerging in the GOP’s hard-line stance against raising tax revenues to slash the deficit, with a number of Republicans willing to go further than their party’s standard-bearer in the face of a looming showdown over the budget.

The softening rhetoric in an election year rife with deficit politics reflects a gulf between Mitt Romney, who pledged during the primary season to oppose new taxes as part of a debt deal, and several Republicans in Congress who are coming to grips with the likelihood that there may be no other path to an accord.


Interviews with more than a dozen Senate Republicans show a growing openness to higher tax revenues to reach a so-called grand bargain on overhauling Medicare, other entitlements, discretionary spending and the Tax Code. On top of that, a small group of House GOP freshmen are balking at conservative activist Grover Norquist’s anti-tax pledge, while six Republican senators recently declined to sign a GOP letter calling for the immediate extension of the Bush-era tax cuts.

All of this points to shifting politics in the tax debate, as Democrats pummel the GOP for opposing tax hikes on millionaires and billionaires. Increasingly, Hill Republicans are signaling flexibility on taxes ahead of another major budget fight.

“Nobody wants to raise taxes, but the question is can you lower tax rates, lower loopholes and deductions and apply that to debt reduction? I think the answer is yes,” said Sen. Lindsey Graham (R-S.C.). “If our position is every time you eliminated deductions and exemptions, all of it has to go to bring down rates, how do you pay off the debt?”

During the primary, Romney opposed using new revenue from closing so-called tax loopholes to pay down the debt and said he’d oppose a deficit deal even if the ratio of spending cuts to tax increases were 10:1.

Some Romney allies see things differently.

“I’d take that deal,” Sen. Bob Corker (R-Tenn.) deadpanned last week.

Of course, there is no deal yet, and Republicans could well reject any proposal calling for higher taxes once it materializes. But with the national debt poised to top $16 trillion, Bush tax rates set to expire and $1.2 trillion in automatic spending cuts poised to take effect in 2013, many on the Hill believe that a major deal can’t be reached without GOP give on taxes.

The party signaled as much during supercommittee negotiations last year, in a proposal floated by Sen. Pat Toomey (R-Pa.), who sought to pair a revenue increase with a permanent extension of the Bush tax cuts. And last June, led by Sen. Tom Coburn (R-Okla.), 34 Senate Republicans voted to end a $6 billion tax break for ethanol producers.

On top of that, if Romney becomes president, one of his first actions could be to raise the debt ceiling. That is bound to trigger a messy feud — or a historic deal — after House Speaker John Boehner (R-Ohio) renewed demands recently for spending cuts to offset any increase in the borrowing limit.

“He’s facing the prospect of being president of the United States in a country with an intolerable debt, and the first thing he’s going to have to do is to ask the Congress to raise the debt limit,” said Sen. Lamar Alexander (R-Tenn.), who is willing to entertain higher revenues coupled with entitlement reforms. “He’s going to have sit down with a Congress that’s going to be fairly evenly split between Democrats and Republicans and come to a result. That’s his job as president.”

Romney said in November he wouldn’t endorse “any plan” that raises revenues. He also said new taxes aren’t the “right answer” to balancing the budget. And during a Fox News debate in August, Romney and his presidential rivals all raised their hands when asked whether they would walk away from a deficit-cutting plan that raises $1 in taxes for every $10 in spending cuts.

Last summer during deficit talks, Romney officials signaled he would want any revenue resulting from ending tax deductions to pay for an equal amount of tax decreases, a call endorsed by conservatives who believe more revenue to the government will simply be spent. And while as Massachusetts governor, Romney raised fees to help close a $3 billion deficit, he has shown little willingness to embrace a similar tack if elected president.

On the other hand, Romney in recent months has talked up the plan floated by leaders of the White House deficit commission — Democrat Erskine Bowles and Republican Alan Simpson. Romney said at a February town hall meeting that he thought “very highly” of the recommendations while he criticized President Barack Obama for not embracing them.

His tax cut plan — reducing individual tax rates by 20 percent across the board — could cost the Treasury $3 trillion in revenue over the next decade, according to some estimates. Romney officials say the government would receive more revenue from the economic growth that would occur from simplifying the Tax Code, repealing the alternative minimum tax and broadening the tax base.

“Gov. Romney does not support tax increases,” a senior Romney official said Tuesday. “To balance the budget, he will cut spending.”

The official added that Romney has never said he supports the Bowles-Simpson plan. But Romney backs the duo’s basic approach: lowering tax rates across income groups while broadening the tax base. About one-fourth of the $4 trillion in deficit reduction in the Bowles-Simpson plan would have come from higher tax revenue, mainly closing deductions.

Romney, too, has signaled a willingness to get rid of tax deductions, though he’s been mum on specifics. At a fundraiser in April, reporters overheard Romney say he’d be willing to get rid of a handful of deductions, such as for wealthy individuals’ second homes.

Sen. John Cornyn (R-Texas) suggested Romney’s stance on revenues could shift if he’s elected and deficit talks pick up steam.

“There is such a thing as a negotiating [tactic] — you don’t negotiate against yourself,” said Cornyn, a member of GOP leadership. “And you don’t start with your final offer.”

Added Sen. Mike Johanns (R-Neb.): “My impression is if you brought rates down, did real meaningful tax reform, the additional revenue would not be a deal-killer for many.”

Others suggested that it’s time for their party to show more willingness to deal on the tax issue.

“I think it’s the type of platform that we have to look at: It looks at spending; it looks at revenues; it looks at entitlements,” said Sen. Johnny Isakson (R-Ga.).

“I think there are revenues that are available out there that we ought to be taking a look at,” such as tax breaks for oil companies, said Sen. Dean Heller (R-Nev.).

Sen. Susan Collins, the Maine moderate, said she believes “the demands of the deficit require us to look at both sides of the ledger, both the spending side and the revenue side.”