Romney pays 15% tax rate

[Cain]

Democrats need to understand that anyone can reduce their federal income tax to 15%: just run a successful, job-creating corporation like Bain Capital.

Republicans need to understand that anyone -- anyone -- can get away with paying nothing in taxes: just don't have a job. Or an above-ground job.

Lesson: America can be whatever you want. Personally, I don't think the job-creators making millions of dollars a year should have to pay ANY taxes, which would give everyone an incentive to make millions of dollars a year. We need financial incentives becoming rich.

 

[BenBurch]

Um, the financial incentive for becoming rich is identical whether you pay 80% tax or none.\

ETA: If you had to work 8 times harder to GET rich, people would still want it. And along the way, they would generate 8 times the number of jobs...

 

[TheL8Elvis]

Not likely. If Romney has been shirking on his tithing the church would find out during his "Tithing Settlement", which is a meeting all temple recommend holders in the LDS Church have once a year with their Bishop. You bring in your tax forms and show that you are, indeed, paying a full tithe.

I didn't know the church audited its members to make sure they paid up. Nice.

 

[TheL8Elvis]

Um, the financial incentive for becoming rich is identical whether you pay 80% tax or none.\
.

Right ... how could Cain possibly have missed that ... hmm ....

 

[Tricky]

Democrats need to understand that anyone can reduce their federal income tax to 15%: just run a successful, job-creating corporation like Bain Capital.

Right. All you need is capital. And where do you get capital if you're not already rich? Damn that catch 22.

 

[Puppycow]

80% of the Bush cuts went to the middle class, not the rich.

"Middle class" here being defined as everyone earning less than $250,000 per year. That's 98% of the people. So another way of putting that is that 20% of the Bush tax cuts went to the top 2% of earners.

 

[Cain]

Right. All you need is capital. And where do you get capital if you're not already rich? Damn that catch 22.

It's not a catch-22 if all you have to do is pick yourself up by your bootstraps. See, that's another difference. Democrats just say how difficult and unfair things are. Maybe that's true, but Republicans make you feel better: You can do anything! Morning in America! Mission Accomplished!

 

[Puppycow]

Another question is how many years of tax returns is Romney going to release.

One gets the impression from he statements that he only wants to release his 2011 return (as recently as last month he was still insisting that he wouldn't release any at all). It would be interesting to see his returns from previous years though, before he was running for president, and what kind of loopholes he took advantage of.

The New York Times points out:

There is no “if” about the tradition. President Obama released eight years’ worth of tax returns when he pursued his party’s nomination four years ago. He has already made public his complete return for 2010, as well as other tax filings since he took office, as presidents of both parties have done for decades.
. . .
Mr. Romney also can look to his own father, George. He released a dozen years of tax returns when he ran unsuccessfully for the Republican nomination in 1968, leading Richard Nixon to follow suit.

 

[fishbob]

I wonder when tax day actually comes for the average American. Since as has been discussed here numerous times close to half pay no federal income tax. I suspect for close to half of Americans tax freedom day comes before late January/early February.

Federal tax is only part of the overall tax picture, and failing to look at the total tax per person is grossly misleading. State, county, and city sales taxes, property taxes, other income taxes, excise taxes, all need to be taken into account. And these are higher on a percentage basis for low income workers. For example, Romney pays less than 1% in Social Security tax while I pay 6.2%. People who pay no federal income tax still pay SS tax, sales taxes, property taxes, etc. Even renters indirectly pay property taxes.

So, late Jan/early Feb for tax day for any significant number of Americans? I don't think so.

 

[WildCat]

Um, the financial incentive for becoming rich is identical whether you pay 80% tax or none.\

ETA: If you had to work 8 times harder to GET rich, people would still want it. And along the way, they would generate 8 times the number of jobs...

It's not about becoming rich, it's about encouraging investment.

Why do you think munis carry no federal income tax liability at all?

 

[JoeTheJuggler]

One gets the impression from he statements that he only wants to release his 2011 return (as recently as last month he was still insisting that he wouldn't release any at all).

I assumed that was the only one he intends to release, since he said he'd release it sometime around April. (Unless he had stuff from previous years that was still pending and he planned on taking care of all that by this year's deadline.)

 

[JoeTheJuggler]

It's not about becoming rich, it's about encouraging investment.

Actually it's about paying taxes.

The government can invest (in infrastructure, for example) as well or better than the "job creators".

Trying to change a discussion about what tax rate Mitt Romney paid into a discussion about investment is a red herring argument.

Also, if that approach were correct, then there would never be a need to discuss whether anyone is paying his or her fair share. The optimal tax rate would be as low as it can possibly be. . . for everyone.

And even if that were true, and Romney paid less than most people with his income, it would make him look bad in the eyes of many voters.

 

[BenBurch]

It's not about becoming rich, it's about encouraging investment.

Why do you think munis carry no federal income tax liability at all?

Because that way government can run more cheaply. They can offer a much lower rate than other bond issuers because of the tax break.

If you increase the tax on other vehicles, you will make money for local government even cheaper by increasing the demand for municipal bonds. If it gets enough cheaper, some of the deficits local governments are faced with are reduced considerably.

And what I most want to encourage is not investment, it is small investors. Guys who make a half million or so a year and want to put it to work. So, perhaps we set a cap. Investment income below a certain amount, for argument say $1 million, at a lower-than-current 12.5% and any amount above that at 30%.

 

[WildCat]

Because that way government can run more cheaply. They can offer a much lower rate than other bond issuers because of the tax break.

You're so close here...

By that same reasoning doesn't lower tax rates for capital gains attract more investment capital than if the rate were higher?

 

[Puppycow]

I assumed that was the only one he intends to release, since he said he'd release it sometime around April. (Unless he had stuff from previous years that was still pending and he planned on taking care of all that by this year's deadline.)

The reason it would more interesting to look at previous years than this year is because he's probably telling his tax accountant not to take any unusual deductions or tax shelters because he's going to release his tax return to the public this year. Whereas in previous years his instructions might have been very different, such as putting money in overseas tax shelters or taking advantage of arcane loopholes only available to the very rich and savvy.

So I don't think he should get a pass on this from the press if he only releases this year's tax return. Obama released 8 years of returns. Romney supporter Chris Christie says that:

"The way I've conducted myself in my public life all along is I've released all my tax returns, and I did it during the campaign," Christie said Wednesday morning on MSNBC, "went back a number of years and released my tax returns, and I've released them every year after I filed them -- right after I filed them to the public in New Jersey so they can see everything. And I think that's the right way to go, and that's what I would tell Gov. Romney to do."

 

[Puppycow]

There is a story on ABC news now about Romney's investments in the Cayman Islands.
My stupid phone can't do links but if someone could find the link and post it I'd appreciate it.

 

[Bri]

I assumed that was the only one he intends to release, since he said he'd release it sometime around April. (Unless he had stuff from previous years that was still pending and he planned on taking care of all that by this year's deadline.)

That may be his intention, but I suspect people will be interested in seeing his returns for several years, like most other presidential candidates (including Romney's father) have done. There is a suspicion that he'll do something to make his returns more favorable this year than they were last year.

-Bri

 

[Puppycow]

There is a story on ABC news now about Romney's investments in the Cayman Islands.
My stupid phone can't do links but if someone could find the link and post it I'd appreciate it.

I'm back at my home computer now. Here's the story:
Romney Parks Millions in Cayman Islands

Although it is not apparent on his financial disclosure form, Mitt Romney has millions of dollars of his personal wealth in investment funds set up in the Cayman Islands, a notorious Caribbean tax haven.

A spokesperson for the Romney campaign says Romney follows all tax laws and he would pay the same in taxes regardless of where the funds are based.

As the race for the Republican nomination heats up, Mitt Romney is finding it increasingly difficult to maintain a shroud of secrecy around the details about his vast personal wealth, including, as ABC News has discovered, his investment in funds located offshore and his ability to pay a lower tax rate.

"His personal finances are a poster child of what's wrong with the American tax system," said Jack Blum, a Washington lawyer who is an authority on tax enforcement and offshore banking.

 

[eeyore1954]

Federal tax is only part of the overall tax picture, and failing to look at the total tax per person is grossly misleading. State, county, and city sales taxes, property taxes, other income taxes, excise taxes, all need to be taken into account. And these are higher on a percentage basis for low income workers. For example, Romney pays less than 1% in Social Security tax while I pay 6.2%. People who pay no federal income tax still pay SS tax, sales taxes, property taxes, etc. Even renters indirectly pay property taxes.

So, late Jan/early Feb for tax day for any significant number of Americans? I don't think so.

I am not going to bother working it out but I do understand about all the other taxes people pay. But if the net federal and FICA taxes paid are zero for a family of 4 with 2 children. I find it reasonable to think other taxes are around 10% or less. Most states/localities do not charge sales taxes on staples, most states have their own versions of EIC, etc.

In my opinion a lot of people should be paying more income taxes. Not the democrat plan only those above 250,000 and not the republican plan of no one.

 

[Bri]

Romney Parks Millions in Cayman Islands

...

A spokesperson for the Romney campaign says Romney follows all tax laws and he would pay the same in taxes regardless of where the funds are based.

...

So it costs Romney the same amount regardless of where he puts his money, so Romney puts his money in the Caymans because...?

-Bri