Romney tax release shows 14.1 percent rate in 2011

September 22, 2012

(Reuters) – Republican presidential candidate Mitt Romney fought back on Friday against Democrats’ claims that he paid no taxes in some years, releasing a letter from his accountants saying he paid an effective federal tax rate of at least 13.6 percent annually over 20 years.

Despite heavy political pressure, Romney stood firm in refusing to make those returns public, but followed through on an earlier promise to release his 2011 return. It showed he paid $1.9 million in taxes on more than $13 million in income – an effective tax rate of 14.1 percent.

That is a lower rate than most American wage-earners pay because Romney gets most of his income from investment profits, dividends and interest. Those earnings are taxed at a lower rate than wages, which are taxed at a top rate of 35 percent.

President Barack Obama, Romney’s foe in the November 6 election, paid a rate of 20.5 percent in 2011, and Romney’s vice presidential running mate Paul Ryan paid an effective rate of 20 percent last year.

Romney’s release of a 20-year summary of his annual returns came in response to allegations from Senate Democratic leader Harry Reid and others that Romney might have avoided paying taxes at all in some of those years.

But the release did not ease criticism of Romney for his refusal to let the public see tax returns for the years before 2010. The Obama campaign said his use of overseas tax havens in jurisdictions such as the Cayman Islands was another sign that Romney plays by tax rules that favor the rich and powerful, and enjoys benefits that are not available to most Americans.

“Why does Mitt Romney not just release the full returns, instead of the bare summary he has provided of the last 20 years, so voters can make their own judgments about Mitt Romney’s finances?” asked Stephanie Cutter, Obama’s deputy campaign manager.

Romney has steadfastly refused to release the returns, breaking a longstanding presidential campaign tradition. He said earlier this year it would just give Democrats “hundreds or thousands of more pages to pick through, distort and lie about.”

Romney also was criticized for taking less than the full write-off for his charitable donations in 2011, an unusual move designed to keep his effective tax rate above the 13 percent minimum that Romney said in August he had paid each year.

Without the move, Romney would only have paid an effective tax rate of about 10.5 percent, David Kautter of American University’s Kogod Tax Center estimated.

But the maneuver was political embarrassing for a candidate who said earlier this year that he did not pay more taxes than were legally due and if he did “I don’t think I’d be qualified to become president.”

Reid said in a statement the move raised questions about Romney’s other tax dealings.

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1 Comment - what are your thoughts?

  • Rattlerjake says:

    So what is the point. Liberals turn every molehill into a mountain. In 2011 Romney paid more in taxes than Obuthead has paid in his entire life! What this tax information shows is how the US government is raping the wealthy financially to pay for their garbage entitlement programs and foreign aid.

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