Mitt Romney’s tax returns shed some light on his investment wealth
Mitt Romney offered a partial snapshot of his vast personal fortune late Monday, disclosing income of $21.7 million in 2010 and $20.9 million last year — virtually all of it profits, dividends or interest from investments.
None came from wages, the primary source of income for most Americans. Instead, Romney and his wife, Ann, collected millions in capital gains from a profusion of investments, as well as stock dividends and interest payments.
The couple gave away $7 million in charitable contributions over the past two years, including at least $4.1 million to the Church of Jesus Christ of Latter-day Saints. Romney’s family has for generations been among the Mormon Church’s most prominent members.
The Romneys sent somewhat less to Washington over that period, paying an estimated $6.2 million in federal income taxes. According to his 2010 return, Romney paid about $3 million to the IRS, for an effective tax rate of 13.9 percent.
For 2011, Romney estimates that he will pay about $3.2 million, for an effective rate of 15.4 percent. That’s in line with his earlier estimates, but sharply lower than the rates paid by President Obama and Romney’s closest Republican rival, Newt Gingrich.
“You’ll see my income, how much taxes I’ve paid, how much I’ve paid to charity,” Romney said at a debate Monday night in Tampa. “I pay all the taxes that are legally required and not a dollar more. I don’t think you want someone as the candidate for president who pays more taxes than he owes.”
He said his tax bill is “entirely legal and fair,” adding: “I’m proud of the fact that I pay a lot of taxes.”
Romney released his tax returns — nearly 550 pages, including the 2010 returns for three family trust funds and a foundation — in a bid to regain his footing in the Republican presidential campaign after stumbling badly in last weekend’s South Carolina primary.
The Romney campaign planned to publicly release the tax documents Tuesday morning but gave a preview late Monday night to The Washington Post.
In recent days, Romney’s GOP rivals have pressed him to make his returns public, arguing that it is critical for the public to vet his finances before the party settles on its nominee. The revelation that Romney pays a significantly lower tax rate than most wealthy Americans underscores his image as a multimillionaire financier, an image that some Republicans believe would hurt his chances in the general election.
Economic inequality is emerging as a central theme in the battle for the White House, with Obama trying to harness populist anger at Wall Street and corporations against a backdrop of chronically high unemployment. He plans to call for higher taxes on millionaires in his State of the Union address to Congress on Tuesday night, embracing an idea advanced by billionaire investor Warren Buffett and Occupy Wall Street protesters.
“The president believes that it is not fair — inherently not fair — that those who are millionaires and billionaires pay at a lower rate than average Americans who are struggling to get by,” White House press secretary Jay Carney told reporters Monday. “This theme about economic insecurity for the middle class . . . is what got this president into politics. So this is a foundational belief for him, and he’s happy to have that debate.”
via the BBC
Damn, I wish I could pay 14% for my taxes......Mitt Romney reveals 14% taxes
Mitt Romney pays a lot more than most Americans in tax, but he also pays proportionally a lot less.
He paid more than $6m (£3.8m) over two years at a rate of just under 14%. The average American pays around 11% tax, but the top rate is 35%.
What all this underlines is that Mitt Romney is very, very rich, earning more than $45m dollars in the last two years.
I suspect how people will see the bald facts will divide fairly neatly along party lines, at least at first.
But it underlines a damaging perception that could hurt him in a presidential election if he does end up as the Republican candidate.
Return to tax policy
First off, the good news for Mr Romney: he's squeaky clean. There is no suggestion of anything dodgy going on. As he points out, no one pays more tax than they owe.
The reason Mr Romney pays a lower rate than, say, President Obama (26%) or Newt Gingrich (over 30%) is because there's a different tax rate for income and investments.
That raises a much wider argument, and one that will be central to the election in November. It is precisely why the billionaire investor Warren Buffet said the tax rate was unfair and should be changed because he paid a smaller proportion of his income than his secretary.
Mr Obama has taken up that call with enthusiasm, even naming his proposed rule after Mr Buffet.
It plays in to a national debate on wealth and fairness that could be critical to Mr Obama's re-election or defeat. The president will make the idea of a fairer society, where the rich do more to help the struggling middle classes, a centrepiece of his State of the Union speech tonight.
We are told the themes will be similar to a speech a few months ago in Kansas, where he attacked opponents of any tax rise.
"Their philosophy is simple: we are better off when everyone is left to fend for themselves and play by their own rules," Mr Obama said.
"Well, I'm here to say they are wrong. I'm here to re-affirm my deep conviction that we are greater together than we are on our own.
I believe that this country succeeds when everyone gets a fair shot, when everyone does their fair share, and when everyone plays by the same rules."
Romney's tin ear?
Mr Obama hopes, at a time when many Americans are suffering economically, they will see this as "fairness" not "class war".
But attacks on the rich have never worked very well in America. He must hope that there is an underlying sense of resentment.
Mitt Romney and Newt Gingrich are battling for Florida after Mr Gingrich won South Carolina
I am simply not sure whether the public mood has changed or not. It is something I hope to look at when I go to Florida.
On the surface this should not make much impact on the Republican race. After all, the party admires wealth-creators and success and thinks taxation should be much lower.
It is an irony that under Mr Gingrich's tax plan Mr Romney would pay almost nothing.
But Newt and the others raised his tax returns for a reason. Mitt has an uncanny knack of making statements that suggest he's so wealthy that he doesn't think the same way as the rest of us.
He chortles that he forced Ted Kennedy to take out a second mortgage to run an election campaign against him. He wagered an imaginary $10,000 when most of us would have flourished a fictional hundred.
Republican voters may love multi-millionaires and lionise the very wealthy, but they don't like elites and patricians. Neither do the people who voted for them in the mid-term elections.
At the moment they don't much like bankers on Wall Street. They like their rich folk to behave as though they're are just ordinary Joes at heart.
Both Mr Obama and Newt want to paint Mr Romney as dangerous and out of touch with the mood of America. That's what's taxing Mitt.
