Romney May Be Fueling Fire of Tax Justice Advocates

Print Share on LinkedIn More

January 17, 2012; Source: New York Times | In Monday night’s Republican presidential debate, former Massachusetts Gov. Mitt Romney fumbled and bumbled around Texas Gov. Rick Perry’s challenge to release his tax returns to the public. After a few humina-humina moments, Romney finally described himself as “not opposed to doing that,” said he’ll “keep that open,” and was most likely “going to get asked to do that” around April of 2012. Maybe he was concerned that the public would figure out what they already know; Romney is plenty wealthy, worth between $190 and $250 million, and seems to have relatively little in common with America’s middle class despite his stated fear of getting pink-slipped on the job at the Boston Consulting Group and Bain Capital.

Despite his multimillionaire status, Romney has now revealed that his effective tax rate is approximately 15 percent. Romney explains that he really doesn’t do much in the way of income-generating work, other than giving paid speeches (at an average of $41,592 per speech from February 2010 to February 2011) and receiving royalties on his book (which he donated to charity). Most of his income comes from dividends on current investments, capital gains on mutual funds, and some post-retirement shares of the investment income of Bain Capital.

Romney’s trickle of revelations regarding his taxes provides a great service to all of the nonprofits that have been advocating for tax justice. Let’s see. . . .

  • He’s worth perhaps a quarter of a billion dollars but pays taxes at a lower rate than most NPQ Newswire readers. It’s a good argument for a much fairer tax structure that involves higher rates for the wealthy.
  • He gets to pay a 15 percent effective tax rate because his income is mostly investment income and capital gains from mutual funds. That’s a good argument for establishing some greater equity between people who have to work for a living and those whose income comes from passive investments.
  • He contorts himself to avoid revealing his income tax returns despite unrelenting pressure from Perry and former House Speaker Newt Gingrich, who thinks it is silly for presidential candidates to hide their tax returns. He is helping make the argument for more transparency in our political system.

So—what is your tax rate?

Perhaps Mitt Romney’s candidacy is inadvertently making the case for big-time changes in federal tax policy.—Rick Cohen

  • Laura

    No surprise this article is from Rick Cohen — SO what — who cares about Mitts tax rate? Tell us Rick, what is Barry Obama’s tax rate? Do we even know how much he made in any given year — no, because he sealed and hid all records dealing with his past….

    report fairly and acurately rick…. please

  • Linda

    All Presidents tax returns are a matter of public record. They cannot be concealed. The previous comment is inaccurate.

  • Laura

    Correction — he had released tax returns but nothing else – — did anyone care about obama’s tax rate or where he made the $1= million in income? No

    The point is — Rick Cohen continues to put out articles that are unflattering to only Republican or conservative politicians. There are many of us out there who would like to see a lot less bias

  • rick cohen

    Dear Linda and Laura: thanks for your comments. Actually, Laura, I have covered plenty of Democratic politicians and looked just as closely at their finances and their connections to the nonprofit sector. Maybe you didn’t see it, but I wrote a major series about the presidential candidates in 2008 and did tough articles on the Obamas (including Michelle Obama’s work for the University of Chicago hospital) and on the Clintons (particularly their resistance to disclosure regarding contributions to the Clinton Foundation at that time). And I consistently cover lots of Democratic politicians. Just remember that the Republican presidential candidates are (1) many (though the number is shrinking) and (2) regarding their nonprofit connections, new to NPQ readers because (other than Gingrich), we haven’t covered them before. But Laura, when it comes to politicians, at least for me, it doesn’t matter what the party is. With Obama and Romney, as any reader of my columns knows, I advocate for disclosure. Thanks for reading, Laura! And thanks for your correction, Linda!