After refusing for weeks to release his taxes, Mitt Romney now says he'll do so -- by tax day, April 15. But the real news is what Romney has now admitted about his taxes -- the fact he doesn't want to become news once the media begin scouring his tax forms.
It's not how much Romney earns. Everyone knows he's comfortably in the top one-tenth of one percent.
It's how much he pays of it in taxes. Romney says he pays a tax rate of "about 15 percent."
That's lower than the tax rate most of America's middle class face and far lower than the 35 percent top rate after the Bush tax cut. (To put this in perspective, recall that the top income tax rate under Dwight Eisenhower was 91 percent.)
Newt Gingrich immediately pounced on Mitt's admission as evidence that Newt's proposed flat 15 percent tax is ideal, and wants to call it the "Romney tax." Newt's flat tax is a fraud. It would dramatically lower the taxes of most of the top 1 percenters and increase the taxes of most of the rest of us.
The real smoking gun is how Romney manages to pay only 15 percent on what's been his money-gusher of compensation from Bain Capital. Romney hasn't released his tax returns yet, but the most obvious answer is he treats his Bain income as capital gains -- subject to the current capital gains rate of only 15 percent.
A loophole in the tax laws allows private-equity managers like Romney to treat their compensation as capital gains. It's legal but it's a scandal. Income from employment is employment income, period.
Private-equity managers cling to the technicality that the money they take out of their companies comes from the appreciation of assets they own and sell. That may be true, but it's still income they get from their jobs. Common sense would dictate it be treated as ordinary income.
Congress has vowed for years to close this loophole. But somehow it persists. Even when Democrats have been in charge, they haven't been able to close it.
Guess why. The managers and executives of private-equity funds are big donors to Republicans and Democrats alike.
Don't call it the Romney tax, as Newt wants to do. Call it the Romney tax loophole. And let him explain why he thinks it's justified.
Robert Reich is the author of Aftershock: The Next Economy and America's Future, now in bookstores. This post originally appeared at RobertReich.org.
Follow Robert Reich on Twitter: www.twitter.com/RBReich
Chris Ladd: What Mitt Romney Would Pay Under the Gingrich Plan
Peter Dreier: Occupying the GOP
Dave Johnson: Why Keep the Capital Gains Tax Break?
Dan Mulhern: Is Capitalism the Bain of Romney's Political Existence?
 |
 |
|
| Obama | Romney | |
|---|---|---|
| Electoral Votes (270 to win) |
332 | 206 |
| Obama | Romney | |
|---|---|---|
| Total | 65,899,660 | 60,932,152 |
| Percent | 51.1% | 47.2% |
| Democrats* | Republicans | |
|---|---|---|
| Current Senate | 53 | 47 |
| Seats gained or lost | +2 | -2 |
| New Total | 55 | 45 |
| Democrats | Republicans | |
|---|---|---|
| Seats won | 201 | 234 |
And that's without working for the year!
That's the kind of money that might lead a man to make wildly extravagant out of touch impulse bets!
26) According to the CBO, the middle quintile of households pay about 15%. That’s about equal to Romney this year and HIGHER than what Romney paid last year. Romney’s fifth quintile should be paying around 25%, with Romney at the top of the top. But mega-rich Romney pays only 15%.
http://www.cbo.gov/publications/collections/collections.cfm?collect=13
27) Now that Romney has trickled out a few returns (after flip-flopping that he would NOT release them) they can be analyzed. Conclusion: “Romney’s overall tax rate is in line with that of the average American taxpayer. However, it has drawn fire because the federal tax system is designed to be progressive — the more you earn, the more you are supposed to pay.”
http://www.washingtonpost.com/politics/mitt-romney-releases-tax-returns/2012/01/23/gIQAj5bUMQ_story_1.html
28) At the top of the thread, Seanwol falsely claimed “Just using the 15% is not telling the whole tax story... The average effective federal tax rate for people with incomes between $40,000 and $50,000, for instance, is just 3.2%”
Sealwol is WRONG! Apples and oranges! Deceptive calculations! That 3.2% uses a completely different methodology. By using the same methodology used to get Romney's 15%, the middle-class middle quintile 15%. Right?
28) 15% SO seanwol was WRONG to claim that Romney's 15% demonstrated "a lack of knowledge on how taxes work."
It would appear you want to compare Romney's effective income tax rate (around 15%) with average American's effective tax rate for all taxes (around 15%)
The only thing this shows is that you are still struggling with the difference.
And I sure that everybody is interested in that you feel the New York Times, CNN, and USA Today are deceptive.
Talk about denial........
This is for all taxes, not effective income tax rate.
Still struggling with the difference.:
30) WRONG AGAIN! I PROVED that it's an unreliable extremist organization run by a proven racist and eugenics-coddler. Their site contains errors that I pointed out in the numbered debunkings that you are hiding from. Who told you they were reliable?
31) Seanwol would know that except he has FAILED to answer the questions that debunk him.
Senwol: “I await your outline of what the average effective income tax rate is...it was the topic of my post.”
32) WRONG! The topic of your post at the top of the thread is “Just using the 15% is not telling the whole tax story, or demonstrating a lack of knowledge on how taxes work.”
On that, you FAIL! The 15% DOES show how taxes work (especially the Romney Loophole) because the middle quintile is also paying 15%, not your bogus 3.2%. Right?
Seanwol “You can easily see that in the graph it outlines that the bottom three quintiles is 15% or lower. This again is for ALL TAXES not just the effective income tax rate.”
33) LOL! So you ADMIT that the middle quintile pays 15% and NOT 3.2%. RIGHT?
34) LOL! So you admit that mega-multi-millionaire Mitt Romney gets to pay a rate as low as the middle class?
ALL TAXES NOT EFFECTIVE INCOME TAX RATE.
You really are struggling with this aren't you?
Seanwol: "I will ask you what part of that post is inaccurate.”
35) LOL! The answers are in the over thirty numbered questions that you CUT N RUN from! Here are a few:
A) Seanwol:“that it is the second time you are taxed on this money”
36) INACCURATE! Prove it works that way at Bain!
B)“Just using the 15% is not telling the whole tax story, or demonstrating a lack of knowledge on how taxes work…. . The average effective federal tax rate for people with incomes between $40,000 and $50,000, for instance, is just 3.2%”
37) INACCURATE! Using the same criteria, super-rich Romney and the middle quintile taxpayers pay the same rate - about 15%, not 3.2%
http://www.cbo.gov/publications/collections/collections.cfm?collect=13
C) The notion that Romney pays less of a percentage then secretaries and other workers is another myth
38) INACCURATE! As proved above.
D)“. It only takes a brief amount of time to research this and see this is hardly the problem.”
39) WRONG! It took you a LOT of time and it IS a problem that mega-rich Romney pays a lower rate than “secretaries and other workers”
Seanwol: “The reason why I'm not answering your ridiculous questions about wikipedia, Paul Krugman, top income tax rates, etc. Is that they are topics that I didn't post about.”
40) LOL! Seanwol does not post about topics that use FACTS to debunk him! PROVED!
Since you disagree with these sources you state "I'm not backing up my story".
Can you tell me what a reliable source is?
You should be a lawyer. I can see you in front of a judge.
I understand that the other lawyer has cited acceptable resources and professional opinions from reputable sources.
But I'm RepublicanDepression and I don't agree with his sources. I have none of my own, but this is how I feel.
Priceless.....
> A loophole in the tax laws allows private-equity
> managers like Romney to treat their compensation
> as capital gains. It's legal but it's a scandal.
> Income from employment is employment
> income, period.
I guess the ability to ignore facts explains how they can support the GOP (Greedy One Percent)
The notion that Romney pays less of a percentage then secretarieÂs and other workers is another myth aimed at those that do their political evaluationÂs via a bumper sticker. The average effective federal tax rate for people with incomes between $40,000 and $50,000, for instance, is just 3.2%, according to Tax Policy Center estimates.
http://monÂey.cnn.comÂ/2012/01/1Â8/news/ecoÂnomy/RomneÂy_effectivÂe_tax_rateÂ/index.htm
For families making $50,000 to $75,000, the effective tax rate is 5.7%. From $75,000 to $100,000, it's 7.2%. And if you make $200,000, it goes up to 9.9%.
We are basically talking about the silverware on the Titanic. As it has been pointed out multiple times in this thread, we could tax billionairÂes 100%, or basically take their money, and it wouldn't begin to solve our problems.
This tax discussion is to rile up a certain group for political purposes so they feel that taxes are the reason for our problems. It only takes a brief amount of time to research this and see this is hardly the problem.
It is only a dumb-downeÂd message for those seeking someone to blame.
Sad.......”
Assuming the article you are looking for is this: "Is Romney's effective tax rate lower than yours?"
The article is a mass of SPECULATION.
1) Has Romney released his tax returns?
"It's not yet possible to verify whether Romney's effective rate is actually 15%."
LOL! FAIL!
2) No? Then it's all conjecture. But at least Romney offers a consistent methodology for calculating his effective rate, right? FAIL!
"But the rate can be calculated in different ways since there are a lot of ways to define taxes."
3) Here's your article's latest FAIL:
"But assuming he's correct, here's why his effective rate is probably higher than most people's: The effective tax rate is always going to be lower than one's top income tax rate. And the top rate for roughly four-fifths of Americans is 15% or less, said Roberton Williams, a senior fellow at the Tax Policy Center. In other words, 80% of Americans have an effective rate below 15%."
WRONG WRONG WRONG!
TOP INCOME TAX RATE is not EFFECTIVE RATE!
NO ONE IS TALKING ABOUT TOP INCOME TAX RATE! Romney didn't say it , so why use it?
Your CNN article is a pack of partisan LIES that I have DEBUNKED!
It's not your fault, seanwol, for relying on CNN.
But now that you know the truth about the flaws in this article's premise, tell us how you will amend your conculsions.
The notion that Romney pays less of a percentage then secretaries and other workers is another myth aimed at those that do their political evaluations via a bumper sticker. The average effective federal tax rate for people with incomes between $40,000 and $50,000, for instance, is just 3.2%, according to Tax Policy Center estimates.
http://money.cnn.com/2012/01/18/news/economy/Romney_effective_tax_rate/index.htm
For families making $50,000 to $75,000, the effective tax rate is 5.7%. From $75,000 to $100,000, it's 7.2%. And if you make $200,000, it goes up to 9.9%.
We are basically talking about the silverware on the Titanic. As it has been pointed out multiple times in this thread, we could tax billionaires 100%, or basically take their money, and it wouldn't begin to solve our problems.
This tax discussion is to rile up a certain group for political purposes so they feel that taxes are the reason for our problems. It only takes a brief amount of time to research this and see this is hardly the problem.
It is only a dumb-downed message for those seeking someone to blame.
Sad.......
That is taxing the same money twice.
Capital gains and dividend taxes amount to a double-taxation on individuals who choose to invest. Because dollars invested had to first be earned, they have already been subject to the income tax. Taxing these same dollars again when capital gains are realized serves to deter productive and much-needed investment in our economy.
Think of it this way. After you pay taxes on your money in your scenario, there is $100 left to invest. Does the government forget about this money as far as taxes are concerned? No. they are evaluating that $100 to see if they can tax it again. I understand that they are only taxing the gain, but they are still looking at the original $100 to see if they can tax it again. Then next year, they evaluate the $115 ($125 - taxes) to see how they can tax this money. Every year the government will look at this same chunk of money to see if they can tax it again.
My whole point is that just looking at Capital Gains, is not the whole picture.
Prove it.
Prove you are being taxed twice on the same income and not on NEW income.
He did not learn from history. His predecessors in the Soviet Union, and elsewhere that confiscated not just all income,but all property from evey one,and than even killed and sent,not just the wealthy,but millions to death and slave labor camps,still went totally and absolutely bankrupt.
Obama's inagural address stated; "...face problems that only government can solve..." Yet, he ,and his bigest and most expensive government did not solve any problem. Just increased the problems of previous administrations and has created,and added much more problems for the people of this nation to endure. Yet,it is Robert Reich who advocates raceing to the total and unavoidable economic demise of the US economy.
Citizens received everything just about free, as they worked for almost nothing. There was no profit, no tax revenues,no taxes either. The system made every body dirth poor.As the government confiscated everything from every body. Socialism is nothing but state capitalism. That is the GLOBALISTS' AIM.
Read my postings, I repeatedly advocate,that not any president, but us,the people. But it was OBAMA who pledged to CHANGE it all. Yet he did absolutely nothing, while he enjoyed a super majority in Congress. He just increased spendings and the deficit,that snow balled to the present crises.
Obamacare has nothing to do with healthcare. It is a $450 billion (over 10 years) pay-back to the insurance industry,a reward for all the campagne donations. It is paid for by deducting it from the Medicare budget, so Medicare beneficiaries will pay higher ($450 billion over 10 years) co-pay. As Insurance Co's do not provide healthcare,they only profit on the public's fear of getting sick.
Just what programms you are willing to cut? They all just want to increase,and do already. The deficit now is $4 billion a day,or $1.6 trillion this year. So where the hell could you find $1.6 trillion additional tax revenues? It would need a 150% tax increase of all and everybody's taxes. Are you willing,or able to pay that ?
(2). Realistic plan how he will restore the industrial productivity of the US. No nation,without industrial productivity can survive,nor re-again any prominent position in the world. And without production of goods that the nation consumes,can survive on its own.
We have been consuming more and more,while producing less and less,what we have consumed, over the decades. While we just impoerted more and more, purchased it all on credit, and paid for it with borrowed money,get us just where we are; the world's most bankrupt nation.
Ideassoul
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I hope someone picks up on this for tne next debate, if not before.
loop·hole
   [loop-hohl] Show IPA noun, verb, -holed, -hol·ing.
noun
a means of escape or evasion; a means or opportunity of evading a rule, law, etc.: There are a number of loopholes in the tax laws whereby corporations can save money.
In this instance, the use of Private Equity firms selling off the assets of a company and claiming those assets are the result of appreciation has nothing to do with "capital gains". They are not investing long term and receiving dividends from their investments.
Next, it is nothing against Romney. By law, he is permitted to take full advantage of any loopholes in any tax laws just like the rest of us. However, it is somewhat disingenuous for him to suggest he knows what it is to be employed and to be out of work and then claim his work was not a form of employment.
Finally, the unemployment rate has nothing to do with the capital gains rate. Never has. You are swallowing the bull that these people are the "jobs creators". The only jobs creators are the consumers of the goods and services being provided. No business creates jobs without a need.
FreddieVee
PS: *I know Newt would have to get Congress to pass the applicable tax laws.
I want to know, would he give the same treatment to Bush's elitist tax cuts? It sounds to me like there are lots of worthwhile programs which would be more important than low taxes, but which would still not be worth the China debt.
From the sound of it, Romney has no problem with the biggest budget buster of the past decade (biggest 3 in all probability, as he won't cut spending in Iraq or Afghanistan, either) but intends to use it as an excuse to slash programs that are far more worthwhile.
I look forward to the day when this overused and silly socialist comment is given the ridicule and laughter is deserves when it is trotted our by you foolish and dishonest Repubicans … that is the day we will get America back … and not a socialist America either.
By the way, did you hear Gingrich's plan to change soclal security … government guarantees of market returns … like they do in Chile …let's hear you go off on Gingrich too now!