Overheard on CNN.com: Controversy over Romney's returns ignites taxation debate
New Jersey Gov. Chris Christie, right, urged GOP presidential hopeful Mitt Romney to release his tax returns.
January 18th, 2012
06:05 PM ET

Overheard on CNN.com: Controversy over Romney's returns ignites taxation debate

Editor's note: This post is part of the Overheard on CNN.com series, a regular feature that examines interesting comments and thought-provoking conversations posted by the community.

One story about Mitt Romney's estimation that he has an effective tax rate of about 15% drew more than 13,000 comments. New Jersey Gov. Chris Christie, a supporter, has called for Romney to release his tax returns, and the South Carolina GOP race is heating up. Romney mentioned that he made about $375,000 in speaker fees, which he called "not very much." Commenters debated whether current tax policies are fair, and they also discussed Romney's views about perceived income disparities.

Mitt Romney's tricky taxes

Romney's money comes from mostly investment-related sources, so his tax rates are somewhat lower than the rate on wages. Fortune's Dan Primack says such lower tax rates (like capital gains rates for profits on investments) are intended to reward taking on the risk of investment and being in business, but also suggests there are loopholes that give some people tax breaks without assuming enough risk to justify it. Readers debated the finer points of taxation policy.

black743: "This isn't a loophole. You invest, you pay 15% on the capital gains. What's so hard to understand about that? He doesn't get a paycheck anymore, he's retired. This is a 15% tax on capital gains of investments. Why can't you people get that through your heads? I would love to see one of you suddenly come into wealth. I'm sure you would just give 35% to the IRS out of the goodness of your hearts, right? I'm so sick of this wealth envy in this country. If we keep raising capital gains taxes on investments, then it's quite easy for folks to just invest in other countries and leave America high and dry."

terre08: "You are wrong. Almost all of his income from Bain was taxed at 15% due to lax regulations when it comes to equity firms. He has a 'pension' as well from Bain where he pays 15% as well for the same reason. It is obviously not called a pension."

The following reader argued capital gains taxes could be raised, since the rates have been higher in the past. (Some are proposing to raise these rates in the future, while others seek to lower them or eliminate the tax entirely.)

Algeria Touchshriek: "Bear in mind that capital gains taxes have simply never been so low. During the Republican idol Ronnie Reagan's era, they were 28%. This little Bush/think-tank experiment has clearly failed, and it's time to bump the capital gains tax rate back up."

One poster said this whole situation was hardly breaking news.

Latch2010: "Wait, you're telling me that the 1% have tax loopholes they use to escape paying their fair share, all the while pointing at the 35% number and braying 'See?! I pay huge taxes!' Colour me shocked, surprised, and clutching for my pearls."

Several commenters suggested that maybe a flat tax is in order. There were also several who were opposed to the idea.

David R. Priest: "Let's put a 15% flat tax with no deductions except charitable, children and a generous personal exemption. This would be fair to everyone. If Mr. Romney paid all of his taxes and broke no laws, there is no issue here."

groksmith: "Brilliant! Shift the entire tax burden from those who can actually pay (the rich and middle class) to those who can't (the poor). Ya, that's not going to have any lasting repercussions for the country. Crackerjack Box economics at its best."

There were a lot of commenters who noted that Romney isn't breaking any laws and thought people were making too big of a deal about the situation. Others wrote in to say that they want to know more about this person who wants to be president.

Wis09: "I'm all for closing loopholes. But Romney is paying taxes LEGALLY based on an existing tax code that he had no part in creating. Why are you even making this a discussion?"

groksmith: "Right...because we can't discuss laws that need to be changed or amended or even created for exactly what reason? How else can you identify and close loopholes if you do not shed some light on them? Come on, it's really not that hard to follow along, is it?"

ldsmom: "But that isn't what you are doing, you are discussing Romney and trying to make him out to be something he isn't just because he is wealthy. If you wanted to change the Tax Code you would have voted into office men/women who would do that, but you continue to vote in the same rich powerful people and then try to blame someone like Romney for something they never did."

RKen: "I'm not sure what rock you've been under, but we are 'even making this a discussion' because this currently a hot topic in the tax reform debate. And Mitt, whether he likes it or not, through the spotlight shed on him in being a front-runner is going to become a well-known example of why people disagree with the regressive aspects of our tax system. Whether you agree with that or not, I think it's pretty obvious why it's being discussed."

nzgrrj: "The reason this is significant is because he has come out and said the system shouldn't be changed and should continue to reward him. Romney hasn't "worked" since 1999 – He is a trust fund kid. I don't begrudge someone that gets wealthy CREATING something (e.g. Bill Gates). Excuse my contempt for a man that has never in his life experienced adversity or had been knocked down then having the mantle of knowledge to go on preaching about hard work and pulling oneself up."

Some discussed why Romney might not want to share his tax returns. Some speculated there might be something to hide, while others said he has a right to financial privacy.

macbll: "There's a possibility that Romney is paying less than 15% if Bain funneled profits through off-shore entities. Also, there is the possibility that Romney is hesitant to release his tax forms because he probably gave a lot of money to the Mormon Church and that's going to deepen the evangelical audience's suspicions about him, ie promoting a "non-Christian religion."

nosense: "Or there's the possibility that he is hesitant to release his returns because he values his privacy like most other people I know. I don't have anything to hide on my tax return, but I value keeping it private myself. Why do I need to know what's on his personal tax return to decide whether or not to vote for him? If there's any concern about them, the IRS can audit them, not us. Furthermore, his accountants, who I'm sure have a stake in making sure their work is done according to law, also have looked at them."

The most-liked Fortune comment was about Romney's speaking fees, which are another component to the candidate's net worth.

earledecker: "By Romney's own admission, he pays 15% in federal taxes. He also says 'I don't make much from my public speaking.' Last year he made $374,000 from his speaking engagements. That is nearly 10 times the income of the average American. Romney is clearly out of touch with the average American. On the other hand, President Obama paid his Federal taxes at a 33% tax rate. Personally I can relate to President Obama and his tax rate. Now you decide which is fair."

Readers had quite a bit to say about the speaking fees issue.

Romney's speech income big money for most

Romney earned $374,327.62 in speaking fees between February 2010 and February 2011, according to documents the candidate filed with the Federal Election Commission in October of last year. The first edition of his book was published in March 2010. Some outrage was expressed at the "not very much" remark.

sonny chapman: "It's like when Bush Sr. was amazed at the price scanner in a grocery store. Or, when Marie Antoinette told the rioters without bread to 'eat cake.' Different planets than the peasants."

But maybe it doesn't matter, as this commenter argued.

JLFuller: "More power to him. Even if $360,000 is not much to him but it is to me, more power to him! I don't give a rat's behind if he makes more in a month than I will make in my life, I will vote for him for what he can do for me and my country. How much he makes or has in assets is none of anyone's business."

Perhaps Romney spoke a bit hastily?

Nobodies Pon: "Whoever paid Romney to speak got ripped off. That guy stumbles over his words most of the time. He has a good radio voice good for sound bites. All that hot air he spits out he should start a hot air balloon ride business."

Some were also baffled by Romney's remark about his speaking fees.

Romney reveals he pays about 15% in taxes

mrphil108: "It's not the 15% that bothers me, as that was he's supposed to pay for capital gains (and I'm a liberal so, yes, some of us do understand the tax code). It's that he refers to $300,000+ as 'a little bit of money.' Just goes to show how out of touch he is about working-class Americans."

And then, some interesting conversations began about wealth-building strategies.

XoriusM: "I pay 36% in taxes. I make less than $100k per year. I'm young and I have no write-offs. I'm tired of carrying the nation on my back while people like Romney don't put in their fair share.

XoriusM: "My federal taxes aren't 36%, they are around the 20s. The rest go to Social Security, state taxes and Medicare. I made $81,000 last year. I payed $29,000 in taxes."

MiddleMomDoc: "Welcome to the middle class. You are paying for irresponsibility and greed of all sorts."

RJM: "So you paid ($29,000) in taxes. How much do you think Romney paid? I'm guessing well over six figures. So who's carrying who?"

dredd57: "If you're paying that much, you better fire your tax preparer and get a new one."

Maiaw: "You are young. Start investing in stock or purchase a house. You can be a millionaire when you retire if you plan now. If you are investing in your 401K, most is likely going into the stock market. Your dividends or any gains over a year will likely be taxed at 15%. (Romney) is being taxed on his gains just like you will when you retire! If you pull out your stocks and gains held less than a year, then it will be taxed more! He is following the tax law. Get educated and get your share before the tax law changes. Don't blame others for planning ahead and making the most of their money. I'm sure (Newt) Gingrich and Obama probably are doing the same thing but just aren't getting as much money out of their investment as Romney. I also agree with dredd57, paying 36% in taxes is way too much. Get some assistance! My husband and I make $175K/year and pay just 20% in income tax."

One commenter said Romney's 15% number is open to interpretation.

Foxtrot22: "Romney thinks he 'probably' pays about 15% in taxes! Does anyone honestly believe this self-proclaimed financial wizard who is so very reluctant to release his tax returns doesn't know EXACTLY how much he pays in taxes!? And does his damnedest to pay as little as possible thanks to the Bush tax cuts and the many other welfare for the wealthy features built into the tax codes! And who pays taxes in Romney's stead? The middle class, of course."

bptsj: "Don't we all try to pay as little as possible? Also, if your income is from many types of investments it is not easy to know what your effective rate was. Maybe last year it was 15% maybe this year it will be 17% ... Also, it doesn't help that every year the tax laws change ..."

Some commenters were wondering about President Obama's tax returns. If you want, you can indeed download them from the official White House website, as the commenter below notes.

StoneTools: "Have you seen Obama's taxes yet?"

want2believe: "They are available for all to see on the White House website. You clearly do not know the power of Google."

This person was longing for the era of former President Clinton, but others were quick to remind them of other things to consider.

useyourhead: "It's amazing how Clinton era taxes were well-balanced. Why can't we just go back to then? 20% capital gains taxes, 39.6% for the upper bracket. It's not rocket science people, it is common sense."

CincyFin: "At least you make a rational argument."

Masse: "Well, we do have the long-term, more serious problem that we are competing with a world market that's happy to make $1/hour or $8/hour as a engineer PhD."

After reading all these thoughts, and reflecting on your own experiences with taxes, what do you think? Share your opinion in the comments area below and in the latest stories on CNN.com. Or sound off on video via CNN iReport.

Compiled by the CNN.com moderation staff. Some comments edited for length or clarity.

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Filed under: Business • Economy • Finance • Mitt Romney • Overheard on CNN.com • Politics • Republican Party • Taxes
soundoff (52 Responses)
  1. Biotechdev

    I'm much more curious why Obama and the media have nothing to say about the national denb under Obama going over the US's TOTAL economic output, and that the debt is outpacing economic growth

    January 18, 2012 at 9:54 pm | Report abuse |
  2. Kandi

    @ Words out of context, do you have a problem?

    January 18, 2012 at 10:56 pm | Report abuse |
  3. Jag0419

    Nobody suggests that Romney is breaking the law. But Americans grow concerned that the candidate who bore into healthy companies, highly leveraged them while laying off thousands of workers all the while paying himself a hugh salary/bonus as a result of this behavior is now benefitting from the tax code by paying a federal tax that on a percentage basis may be less than those he downsized.

    Did this man ever create anything? Did he patent an exceptional product? Did he save lives? No.

    Americans expect and encourage enormous wealth for the likes of a Steve Jobs and others who change the world with their innovation. Americans, however, are getting sick and tired of tens of millions being made via paper-shuffling whether it be Bain Capital or Wall Street vultures.

    The concern over his tax bracket is rational and fair.

    January 18, 2012 at 11:17 pm | Report abuse |
    • Consultation

      Did he ever create anything? How about the fact that without him, there would be no Dominos, no Staples, no Sports Authority. Those national giants have created tens of thousands of jobs due to Bain. Yes some of their companies failed, but the loss is minuscule compared to the job gains in their successes. The top 5% pay 60% of taxes. What's their fair share, 100%. Oh wait, it doesn't matter what anyone pays in taxes anyway, because we have a president that will just spend three times the tax revenue anyway. If the top 5% payed 90% in taxes, we would still be running a deficit. Any solutions are not in changing the tax code, they lie in cutting spending. Pick your president based on whether he will do that, no on whether you are jealous of his wealth.

      January 18, 2012 at 11:58 pm | Report abuse |
  4. GET OVER IT

    QUIT RUNNING YOUR MOUTHS GET UP AND GET INVOLVED THATS WHERE THE CHANGE BEGINS

    January 18, 2012 at 11:40 pm | Report abuse |
  5. Hair Bear

    I don't get it? Why would Romney let Dough Boy convince him to Annie up his taxes! Romney needs to just come clean like all the candidates. What's the big deal? We already no he's rich and in the 1percent! Makes him look like he's wanting to hide something!

    January 18, 2012 at 11:59 pm | Report abuse |
  6. Lew

    And he sat down opposite the treasury and watched the people putting money into the offering box. Many rich people put in large sums. And a poor widow came and put in two small copper coins, which make a penny. And he called his disciples to him and said to them, “Truly, I say to you, this poor widow has put in more than all those who are contributing to the offering box. For they all contributed out of their abundance, but she out of her poverty has put in everything she had, all she had to live on.”

    January 19, 2012 at 1:56 am | Report abuse |
  7. Rogelio

    Romney has parked millions in off-shore havens. Just like the Corporations that are not people have parked millions of our jobs off-shore. Romney's biggest cheerleader is Corporate America. He could with a Republican controlled House could seal the fate of our middle class.

    January 19, 2012 at 10:57 am | Report abuse |
  8. concernedjoy

    Was anyone ever concerned about the tax rate paid by wealthy Democrats running for office?

    January 19, 2012 at 10:57 am | Report abuse |
  9. Scottish Mama

    @Concerned- No because they were willing to pay taxes and give up the tax shelters. The republicans do not want to pay taxes on their wealth. Remember they wanted the wealthy to get the Bush tax cut? The wealthy do not pay taxes like most of us. They have it heavily invested and pay none on that money.

    January 19, 2012 at 11:20 am | Report abuse |
    • concernedjoy

      You gave me my laugh for the day. Well, I know there are a lot of people who buy into that. Saintly democrats – only ones for the little people. So you're saying ALL wealthy democrats running for office paid their "fair share"? Seems I recently heard that John Kerry pays considerably less taxes than the average taxpayer (based on his tax returns). And wasn't he one of the wealthiest people to run for president? And didn't he move his yacht to a different state to avoid taxes? And how much did Clinton make in speaking engagements (and shelters his money – legally, I'm sure, and that is OK) Big deal made out of Romney making under $400,000 in speaking engagements, but not a word about the millions made by Clinton. And anyone who invests their money has already paid taxes on that, plus they pay 15% capital gains tax on their profit. Sounds fair to me. (And for the record, I am in the lower income bracket) I'm sure there are loopholes that could be closed, but until then, all the rich take advantage of it. Not illegal. And check out the tax forms for the rich dems who say it is "immoral". I'm sure they use the same loopholes. As long as it is "legal" it is OK. Check out how much republican politicians give to charily – compared to democratic politicians! As far as tax cuts for the wealthy – all taxpayers got the tax cut. Rich pay taxes and should get the cuts also. And the poor get refunds even though they don't pay taxes! And I know this is a fact – I've seen it in my family.

      January 19, 2012 at 11:57 am | Report abuse |
    • Lisa

      and how many people apointed by Obama owe thousands in back taxes? the democrates are just as guilty

      January 19, 2012 at 12:23 pm | Report abuse |
    • Scottish Mama

      Glad I could be of assistance to making your day brighter. NO not all dems want to pay more. (not an all in my sentence.)Never said that. Kerry is not president and was it illegal for him to move his yacht and isn't it legal for him to have wealth? Turning the tables on you, does not make it right. They are:President Obama is the one who brought up, he is willing to pay more. He exposed it to us "little people". (make yourself feel big?)
      If it is not illegal, still does not make it right. If you don't expose it and do something about it, it doesn't get fixed. Republican congress has nixed and does not want to fix. So those of us that think that it should be and are not happy with satis quo will vote so. Those of you that like it, will vote to let the wealthy do as they please. Thus you let our country go to hell in a handbag. If you are a middle class bracket then you should want the people who get the most out of country pay to have the life they have. Actually we pay more, we have to work for our money.

      January 19, 2012 at 1:10 pm | Report abuse |
  10. Larry in Houston

    At least McCain knows the newter is truely dangerous for this country.. There will be more gridlock, and the same old grind in D.C. the newter is an old re-tread. We are getting a new scoop each hour, Rick Perry out, Sanitarium won Iowa, now the Newter as a swinger with Calistas permission and not the wife, that will air tonight on ABC. What will the christain values folks think or say? This is very revealing. This really works well with the religious conservtative base.

    January 19, 2012 at 11:42 am | Report abuse |
  11. george of the jungle

    not only is the repo party out of touch but they keep looking for ways that millionairs and big business can keep more money. guess who gets to make up the difference. bend over.

    January 19, 2012 at 11:44 am | Report abuse |
  12. Lisa

    if he paid 15%, that isn't the problem so much as how he is avoiding the topic and sidstepping the issue. All candidates release there tax information. I am not angry or upset or jelous that he only pays 15%, but it upsets me that he is just so flipant about it. I struggle every day to make ends meat. My last stub of the year for 2011 says I made 21014.11 Y.T.D, but betewwn taxes, 401k and ins. my net was only 14768.46. so I paid 3551.20 in state & fed taxes medicare & social sec. the rest was ins & 401k. The ins is ok. It does give me a discount, but I still have to pay $5000 out of pocket and our rate just went up again for ins. The company i work for owns 15 hotels and several golf courses and we haven't had raises in 7 years. That is what living in a right to work state like SC does for you. Most people work two and three jobs here to pay for basic needs. When Bain closed the steel mill in Georgetown that put a lot of people out of work and it affected the entire area because all bussiness where affected. Eaterys & small stores closed because of the loss of revenue. While streamlining is a need to keep a business open, bain built a new state of the art plant in another state instead of updating this one. The mill has reopned, but not all the employees are back to work. SC has an unemployment rate of near 10% loosing any job is bad. Romney created some jobs, but not near the volume most want or need. Honestly Most people in Sc are undecided because all the candidates are horrible. I normally have a decision by now, but I don't. Hopefully the debate tonight will help me decide by Sat. I am not wanting to be paid a lot for my job as a reservationist at a hotel, but I would like a wage that I can live on and meet my bills each month and buy the grocerys & medications I need without worrying what bill may not get paid on time. My mom who is on medicare just spent over $100 on a months worth of perscriptions. She has no retirement income except SS. When she retired she had to cash out her fund to pay unexpected bills. Now some want to take even more from the elderly. Since members of congress are exempt from the social security & medicare system they don't give a crap about the working stiffs of america. When they passed Obamacare, there is a provision excluding all members of congress. If it is not good enough for them, then why is it good enough for the american people. Wish there was a real candidate to support.

    January 19, 2012 at 12:11 pm | Report abuse |
    • Scottish Mama

      My point exactly, they make money off us and we do not get to invest the way they do and they have lots of tax shelters. They are still making more money as hotel rooms go up, but you do not get a raise and you pay more for insurance premiums and out of pocket, not to mention food prices, no cost of living raises. So the middle class gets squeezed some more. Since 2000 and especially since 2004 when Bush did his insurance pharma, insurance has gone up 78%.

      January 19, 2012 at 1:18 pm | Report abuse |
  13. jon

    Mr. Offshore Accounts in the Cayman Islands.

    January 19, 2012 at 12:43 pm | Report abuse |
    • concernedjoy

      From what I read, Romney's investments in funds that originated in the Cayman Islands are taxed the same as if they were in the US. I have no problem with the rich as long as they're legally conducting their business. I'm poor, but have several family members who went to college, worked hard at their jobs, watched their money and are doing very well. One member has so many ideas – ended up creating his own business – works very hard at it – employes over 100 people, and until some of the Obamacare expenses hit, he paid for his employee's health insurance 100% (don't see that much anymore) But now, because his costs have risen so much, he has to have him employees pay a portion of their insurance. On the flipside, my husband works with people who earned average wages, but because they lived within their means and saved (or invested) their money, are doing very well and will be able to retire with plenty of money behind them. We were not as wise, thus we are struggling. But I refuse to blame anyone else for our lack of judgment or foresight or whatever you want to call it. More power to those who succeed (on all levels). So much envy and hatred out there – quit worrying about what you don't have and maybe work a little harder and do without some things in order to protect your future.

      January 19, 2012 at 1:15 pm | Report abuse |
    • Scottish Mama

      @concerned -how about stacking the government with regular people who will not make policies for themselves to make them rich? How about policies that include the people the country was made for. Not the people who can take advantage by writing the rules that are stacked against the majority. At concerned you so not seem concerned. You sound like a Gingrich fan, let's get child labor back.
      How about you keep beating yourself to death and let the "legal" steal and run the country into the ground", because it is legal. Now that is 'La, La, Lazy."

      January 19, 2012 at 1:28 pm | Report abuse |
  14. nate

    STEPHEN COLBERT IN 2012!!

    January 19, 2012 at 12:49 pm | Report abuse |
  15. mark

    http://www.youtube.com/watch?v=Aix7tQMdJ3s

    January 19, 2012 at 1:26 pm | Report abuse |
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