"The returns show Romney paid a smaller proportion of his income in tax than most Americans because his income is from investments from his $200m-plus fortune, which attract a lower rate than earned income.
In 2010, Romney earned more than $21m and paid $3m in tax, a rate of less than 14%. He expects to pay $3.2m in taxes on his 2011 income, a rate of 15.4%."
Hat tip: The Guardian
"The former Massachusetts governor shelled out approximately $3 million in federal income taxes on $21.7 million in income that year.
Because Romney gave about $3 million to charity — about half of which went to the Mormon Church — his tax rate was lowered to a meager 14%.
Romney hasn't drawn a real salary in years, and the numbers confirm what most analysts believed: The bulk of his income comes from investment gains.
Because capital gains are taxed at a much lower rate — 15% — than the levy on the salaries of the wealthiest Americans — 35% — Romney has an annual income in the top 1% of Americans paired with a relatively low tax rate."
Hat tip: The New York Daily News
"Romney's tax rate is below that of most wage-earning Americans because most of his income, as outlined in more than 500 pages of tax documents, flows from capital gains on investments."
Hat tip: The Huffington Post
Therein lies the problem - WE NEED TO CHANGE THE WAY INCOME IS DEFINED. You should no longer get a preferred tax rate because you invest.
Listen at NPR for a quick overview of the numbers. Also, did you realize Gingrich is calling for a 15% flat tax rate and he wants to eliminate all taxes on capital gains. This would mean Romney would pay almost nothing at all in taxes. Holy fuck.
7 comments:
As a FB friend quipped, "Mitt Romney's tax rate is a lower percentage than the average tip at Denny's."
I like your FB friend.
Amber, that's such a good comparison. I think I shall steal it.
Does anyone have any good price revenue curves that might show when and if changes in tax rate have an effect on rate of investment? At least with cap gains there's little meat to the argument that (unlike dividends) double taxation is taking place.
BTW -- I was at two days of 9-5 meetings in a room w/26 attorneys. Back of my envelope says they were burning through 5 dollars every second. For 8 hours a day. For two days. Yeeesh.
I'm sure Jared Bernstein and/or Paul Krugman have, at the very least, linked to such graphs. And I can recall reading many clippings in which they and some vocal investors have stated that the cap gains tax rate has little effect on investing. If there's a good deal out there and someone has the money to fund it, they won't back off from the investment because of the tax rate they might pay later on in cap gains.
Dang. That is a lot of money.
@Bruce - When is your next garden party, anyway?
@Babe - Exactly. When you have "so much money you make your living from investments", a few measly percentage points isn't going to discourage you. I mean, what are you going to do instead? Work at Denny's??? (Bonds == let somebody else invest!)
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