In an act of cowardice befitting of Mitt Romney, his campaign has dumped his most recent tax records in the middle of the night. While nothing at first glance appears to be a huge liability to the campaign, his returns at the very least are a damning indictment of the American tax system.
Republican presidential candidate Mitt Romney released tax records on Tuesday indicating he will pay $6.2 million in taxes on a total of $42.5 million in income over the years 2010 and 2011.
Bowing to increasing political pressure to provide more detail about his vast wealth, the former private equity executive released tax returns indicating he and his wife, Ann, paid an effective tax rate of 13.9 percent in 2010. They expect to pay a 15.4 percent rate when they file their returns for 2011.
$42.5 million in income translates to roughly $60k a day, more than most Americans make in A YEAR. There's rich, and then there's ridiculously rich. Especially when your vast wealth has come at the hands of the employees of the companies you own.
Yet, despite his vast wealth, Mitt Romney pays a far lower rate than the average middle class American, despite earning over 365 times what they make. While Americans are being asked to give up vital government services in the name of Austerity, the mega-rich like Romney pay far from their fair share.
Now this in itself wouldn't be an indictment of Mitt Romney. After all, I don't reasonably expect that someone would pay more taxes than the tax system says they owe. However, what is an indictment of Romney is that while he wants to cut taxes for his mega-millionaire buddies and protect his tax rate, he had no problem with letting the payroll tax cut expire, raising taxes on middle class Americans who already pay a higher tax rate than he does.
Besides his tax rate and the sheer size of his wealth, the most noteworthy disclosure in the tax returns was that Romney kept a Swiss bank account until 2010, when he closed it because it posed a "political liability". Like the Cayman Island account, his campaign claims that he paid his regular tax rates on the Swiss bank account, which is probably true for the most recent years. After all, Mitt Romney has been running for President since 2007, and it takes a special kind of stupid to commit tax fraud when you're running for President of the United States. However, with returns this explosive during the years he was carefully cultivating his image, can you imagine what they look like during the years he wasn't?
Mitt Romney may hope these disclosures put the issue to rest, but I think it's wishful thinking. These releases only make people much more interested in the years that he's hiding. If these are the returns he's willing to release, what on earth are in the returns that he's hiding?
He may be able to hold off revealing more returns during the primary, especially when Newt hasn't released more than this years. If he gets up against President Obama, who has all of his returns public since 2000, the pressure is going to be raised tremendously to release earlier returns. I'm going to stock up on the popcorn.
UPDATE 1: A couple of more tidbits about Romney's tax returns: Not all of his income comes in the form of capital gains. About half does ($12.5m in 2010 and $10.7m in 2011), but a significant amount also comes from the carried interest loophole. Romney made $7.4m in 2010 and $5.5m in 2011 via carried interest, which is essentially profits that don't get taxed as profits, but via the 15% rates. This loophole saves Romney millions on his returns.
Also, he has a $100 million trust set up for his five sons, which he pays no gift tax on because of our ridiculous estate tax laws. Good to know that his sons will never have to work a day in their lives and will be richer than most Americans could ever possibly dream of.
Lastly, Mitt Romney, made mention in the debate about how his tax returns would also reveal his charitable donations, as if we could expect him to some sort of super-altruistic rich guy. His returns reveal that he did donate more than $7 million in charitable contributions in 2010 and 2011, however the vast majority of those donations were to the Mormon Church. I think his definition and my definition of charity are two different things.
UPDATE x2: You can find the full returns here: http://mittromney.com/...