Conventional wisdom holds presidential candidates, once they secure their party’s nomination, tack to the centre for the general election. Having appeased the more extreme elements that come out to vote in primary elections, a candidate can drop the pretence of being on the far-right or far-left and don the mantle of reasonable centrist to garner the independent vote’s ever-growing share.

Not so for Mitt Romney. With the inevitability of his candidacy increasing with each passing primary, the founder of Bain Capital will have to demonstrate his conservative bona fides, especially in the area of tax policy, if he wants to convince the public he represents a clear break with the past.

Reducing the corporate income tax rate to 25 percent from its current 35 percent – one of Romney’s five bills for Day One – is pretty standard fare. What about eliminating corporate income tax altogether?

Gaming the System

We haven’t heard “boo” from Romney on the subject of double taxation. Yes, Romney would eliminate estate tax, and he makes passing references to overhauling the tax system to lower and flatten rates and broaden the base. But the man with an MBA and law degree from Harvard has offered no sweeping alternative to the current regimen, no support for a simpler system that would, for example, tax all income once, at the same rate and as close to the source as possible.

That’s the premise underlying The Flat Tax, first published in 1985 by Robert Hall and Alvin Rabushka, senior fellows at the Hoover Institution.

“Whenever different forms of income are taxed at different rates, or different taxpayers face different rates, the public figures out how to take advantage of the differential,” the economists wrote.

You betcha! That’s why executives prefer their compensation in the form of stock options, which will be taxed at the lower capital-gains rate, rather than in salary.

Instead of radical tax reform, Romney, in his 59-point, 160-page economic plan, proposes eliminating capital-gains tax on those earning less than $200 000 (R2 million) a year, an “arbitrary nod to progressivity” that “would do nothing to incent investment”, according to the Tax Foundation, a policy research organisation.

The think tank analysed each candidate’s tax plan on the basis of fairness, neutrality, complexity and the impact on competitiveness, economic growth and tax revenues. Romney earned a “C-”.

Romney revealed this week his effective tax rate was 15 percent. And it’s all perfectly legit. The bulk of Romney’s income comes from investments, which are taxed at a top rate of 15 percent.

If Americans want to be outraged about something, it shouldn’t be the rough-and-tumble form of capitalism practised by private-equity firms, which may, or may not, cost jobs.

Rather, the object of their ire should be the tax code’s preferential treatment of debt, which is tax-deductible, and carries interest.

Improve the GPA

Opinion polls suggest Americans want the rich to pay higher taxes. But I sense more outrage at the unfairness of the system. By unfair, I mean not marginal tax rates per se, which currently top out at 35 percent for individuals, but the tax code’s gaping loopholes that allow and encourage avoidance. Large corporations, with their hoards of lobbyists, buy influence with politicians who reciprocate by crafting tax breaks and exemptions. Such preferences breed inefficiency.

Despite his wishy-washy tax plan, Romney is the only candidate with a chance of beating Obama in November. From everything that’s been written about him, he sounds like a good businessman, hard worker, problem solver and someone you can trust. And he still has time to improve.

Should he become the Republican nominee and face Obama in November, Romney will need to sharpen his debating skills, figure out how to own his enviable record at Bain, rethink his protectionist trade policy with China, and raise his grade-point average on tax policy.

If not, Republicans and independents will have to swallow hard and remember they go to the polls with the candidate they have, not the candidate they might want.

Caroline Baum, author of Just What I Said, is a Bloomberg View columnist. The opinions expressed are her own.