January 24th, 2012
10:46 AM ET

Romney tax release lights up debate on wealth inequality

Republican presidential candidate Mitt Romney made $42.7 million over the past two years and paid $6.2 million in taxes, newly released documents show.

Romney and his wife, Ann, filed a joint 1040 reporting $21.7 million in 2010 income and $3 million in federal taxes. They also said their 2011 income was $21 million and tax bill was $3.2 million. Over the two years, Romney's effective tax rate - the percentage of his income that he owed in federal income taxes - was just under 14%.

Nevertheless, and contrary to popular perception, Romney's effective federal income tax rate is still above that of many Americans - 80% of whom have an effective rate below 15%. That tax rate is higher when other federal taxes - such as the payroll tax - are included.

And there's nothing that gets people revved up like peering into someone else's taxes to learn more about their wealth, especially when they're running for office. So you know that people were abuzz this morning trying to dissect it all, that is, if they could wrap their heads around it.

It appears Romney and his campaign knew that too, and expected the onslaught. If you did a search on Twitter for "Romney Taxes" "Romney Tax Returns" or "Romney" you saw an interesting promoted tweet, meaning someone paid for that tweet to show up at the top of the heap.

And judging by the tweet, Romney's camp must have thought, if people are going to be searching around, we ought to offer a message.

For the most part, the conversation online seemed more focused on what Romney's overall taxes show about America, rather than the candidate himself.

Rick Newman, the chief business correspondent for US News & World Report, tweeted a statistic that seemed to characterize what others were thinking.

[tweet https://twitter.com/rickjnewman/status/161820377935396866%5D

A majority of the comments we saw online showed that many folks, while they may have been a bit revolted by the mass amount of money Romney makes, found that more of the problem was our tax code or a major gap divide between the wealthy and middle class.

[tweet https://twitter.com/edwardvirtually/status/161824789172977665%5D

[tweet https://twitter.com/marclamonthill/status/161820174784282624%5D

[tweet https://twitter.com/marclamonthill/status/161821094037295104%5D

[tweet https://twitter.com/NickKristof/status/161781523740229632%5D

Others bemoaned the general fact that Romney didn't have to pay more, considering what they pay, even if it is all part of the current rules.

[tweet https://twitter.com/Cephster/status/161824859045900289%5D

But others thought that there wasn't any massive damage done by Romney releasing his tax returns, because they showed he also gave money to those who needed it, and simply followed our current rules.

[tweet https://twitter.com/Toni_TWG/status/161824885176401922%5D

[tweet https://twitter.com/jrawlinsisu/status/161823455078125569%5D

Some joked the release was well-timed because it came when people were paying more attention to Oscar nominations.

[tweet https://twitter.com/AndrewCDaniel/status/161823761753063426%5D

[tweet https://twitter.com/joe_hill/status/161812094528913408%5D

[tweet https://twitter.com/carlimck/status/161819689947901952%5D

But for others, there was also a continuing sentiment of wondering why we get all excited about these tax releases anyway.

[tweet https://twitter.com/g2slade/status/161815915418234881%5D

For some, knowing where the politics and money collide along the campaign trail was the more important monetary detail they'd prefer to learn.

[tweet https://twitter.com/betthearm/status/161812408099287040%5D

What do you think? Does it still matter that we see candidate tax returns? And if so, what is your reaction to Romney's release. Let us know in the comments below.

Post by:
Filed under: Economy • Mitt Romney • Politics • Twitter
soundoff (733 Responses)
  1. Jennifer NYC

    All this nonsense started with Mr. Obama starting a class war.

    January 24, 2012 at 2:41 pm | Report abuse |
    • J

      Right because corporate welfare like oil subsidies isn't class warfare. It's only class warfare when the middle class demands fairness.

      January 24, 2012 at 2:45 pm | Report abuse |
    • Nah

      j: "Right because corporate welfare like oil subsidies isn't class warfare. It's only class warfare when the middle class demands fairness."

      First, oil subsidies are arguably unnecessary because if they weren't paid, the difference would be made up at the pump. Except that has what effect? Increasing the cost of gas and everything that relies on fuel for its existence and transportation. Like agriculture.

      And who can afford to pay more for food and gas than anyone else? The poor.

      Hence, oil subsidies help the poor. Shouldn't you be for them, then?

      Second, you assume without proving that more taxes would be "fair". Can you prove this please?

      January 24, 2012 at 2:50 pm | Report abuse |
    • BC

      Good thing somebody started the war! Someone needs to take on the Oligarchs!

      January 24, 2012 at 2:58 pm | Report abuse |
    • bobcat

      For most people to pay taxes is a serious strain on their budgets and can mean that they have to devert meager resources that can criple their investment in their childrens future. Most wealthy can pay taxes without worrying about solvency, and the extra funds raised can allow greater investment in infrastructure that makes the middle class and poor better off without damaging the wealthy who have acces to more resources no often measured by income.

      January 24, 2012 at 3:00 pm | Report abuse |
    • Nah

      bob: "For most people to pay taxes is a serious strain on their budgets and can mean that they have to devert meager resources that can criple their investment in their childrens future."

      First, you're appealing to emotion, not reason.

      Second, at most this is an argument for a 0% tax rate for people making a low income.

      "Most wealthy can pay taxes without worrying about solvency, and the extra funds raised can allow greater investment in infrastructure that makes the middle class and poor better off..."

      And why should the wealthy have to subsidize the poor?

      January 24, 2012 at 3:08 pm | Report abuse |
    • J

      Nah what isn't fair is a system that the rich can exploit to loophole their way out of paying a share that they can afford. If the upper 1% all actually paid their 35% I wouldn't be complaining, but +1,500 of millionaires and billionaires don't yearly. And as for the price of gas, that is controlled by demand not by subsidies: http://www.propublica.org/article/despite-rhetoric-cutting-oil-subsidies-would-have-little-effect-on-gas-pric/single

      Fairness means everyone plays by the same rules.

      January 24, 2012 at 3:09 pm | Report abuse |
    • RKen

      Funny how decades of promoting the idea of the "welfare queen", disparaging anyone that has to fall back on any kind of welfare/assistance, or claiming anyone that isn’t rich didn’t work hard enough is perfectly fine (and common).

      But, discussing income inequality and the growing wealth distribution gaps over the past 6 months is considered "class warfare."

      Bazaar, isn’t it?

      January 24, 2012 at 3:12 pm | Report abuse |
    • Diggit1234

      Jennifer – Hahaha – what?!? OBAMA started class warfare?! How thick are those blinders you're wearing?! Have you ever paid-attention to anything pre-2008? I'm rather certain class warfare has been around since the dawn of time and that has only gotten progressively worse in the US since post-world war II. Particularly, in the 70s up until the present day. Read a book, I dare you.

      'And Nah – 'First, oil subsidies are arguably unnecessary because if they weren't paid, the difference would be made up at the pump. Except that has what effect? Increasing the cost of gas and everything that relies on fuel for its existence and transportation. Like agriculture.'

      Wouldn't the problem then be supporting, relying and being bought-out by an infrastructure that won't ALLOW change and/or money be put into systems that might ween us off of the spout? To benefit businesses starting out in alternative methods of fuel, energy, distribution, etc. You know, the things that politicians loooove to tell you that this country is founded on, but disregard in two seconds when it comes to actually supporting the cause?? Or is that too long-term in thinking? And if you look at the numbers...you're wrong in so many other ways. How do oil companies, who drain and rain more profit than anyone else in the world, manage to keep subsidies? To keep winning those 'battles' in the Congress to further degrade and put our environment at risk for what is already known as a finite and destructive fuel source...and one that promotes the risk of your health and your children's. You might also ask yourself who benefits most from the oil companies in this world...and why we need them so badly...and one main answer would be the military structure that the US encompasses. There are larger reasons out there to keep oil cheap than you might like to believe. Hence, the lovely war we were locked up in for 8 draining years. Doesn't really make much sense when you think about it, does it...all the atrocities committed and lies spouted, to the poor and lesser-off in this world...just for control, power and wealth.

      – Can you explain what you mean by this?? The word 'afford' in this statement is really mis-leading. They wouldn't be POOR if they could AFFORD things. The last thing oil subsidies do is 'help the poor'. Seriously, fess-up...you work for Chevron.

      And why wouldn't more taxes be fair? Why is someone who's pulling in 22 million a year recieving 20% less tax than someone who makes 85K? It has been PROVEN that larger tax rates on those in the top-tier, which is DEFINITELY not going to hurt them, benefits the country as a whole. The 1% is not producing more jobs, is not distributing more wealth and couldn't care about charity unless it benefited their electoral base...so don't feed any of that garbage. The middle and lower classes are the engines that turn this economy. Withouth jobs, no tax, no churning, no life to the system. Those at the top continue seeking ways to lower the bottom line, how to increase profit while dumping more overhead. It doesn't hurt to have a few subsidies or tax loopholes in place to help with the cause. Do the math – you sound like a decently intelligent person...don't play the game. It's really not that difficult to see through the manuer when you take a step back. Unless you're part of the problem and make the conscious decision not to recognize truth and fact.

      Hence, oil subsidies help the poor. Shouldn't you be for them, then?

      Second, you assume without proving that more taxes would be "fair". Can you prove this please?

      January 24, 2012 at 3:12 pm | Report abuse |
    • Nah

      diggit: "Can you explain what you mean by this?? The word 'afford' in this statement is really mis-leading. They wouldn't be POOR if they could AFFORD things. The last thing oil subsidies do is 'help the poor'. Seriously, fess-up...you work for Chevron."

      Sorry to make you so angry, but the word afford means precisely what it says: the poor are the least able to afford an increase in the price of gas and groceries. Both of which are necessarily affected by oil subsidies. Why? Because the subsidies allow companies to reduce the sale price of their products. Why? Because they want to compete with others, gain more business and, consequently, make more money by selling more things.

      Hence, the oil subsidies allow oil companies to compete with each other, reduce prices, and the poor are the winners. Why? Because they don't pay the oil subsidy through taxes or a proportional increase in price at the pump.

      "And why wouldn't more taxes be fair? Why is someone who's pulling in 22 million a year recieving 20% less tax than someone who makes 85K?"

      Sorry, but anyone who makes $22 million per year is necessarily paying multiples of what normal people do. Whether their tax rate is 15% or 100%, the actual amount of taxes they're paying is higher.

      Much less, you haven't proven that raising taxes is "fair". Especially since you (apparently) aren't able to show how it's fair to make one part of the population pay for almost all of the government and its functions.

      "It has been PROVEN that larger tax rates on those in the top-tier, which is DEFINITELY not going to hurt them, benefits the country as a whole."

      First, whether something will not hurt someone and will benefit someone else is irrelevant. Or would you consider theft of one of Jay Leno's cars to be permissible?

      Second, you merely say, without proving, that it would benefit the country. That implies that the rich wouldn't merely raise the price of the goods and services the provide in order to keep their wealth where it is. Can you please cite facts and figures in support of your position?

      January 24, 2012 at 3:19 pm | Report abuse |
  2. J

    Finally something good comes out of this circus reality TV show called the GOP primary's. Capital gains taxes after a certain amount should be taxed at a higher rate. It's crazy that you can pay a far lower tax rate on investments then on the equivalent amount of wage income. The economic benefit of those investments don't always justify a tax rate of 15% Glad other GOPers raised this issue cause of course if Obama had, we'd be hearing cries of "socialism!"

    January 24, 2012 at 2:41 pm | Report abuse |
  3. woodofpine

    "Don't Tax Me, and Don't Tax Thee – Tax the Man Behind the Tree!" My CPA dad used to say that's what everybody postures politically. He hated taxes and the IRS. The problem is we've got to pay as we go and pay off debt. During my dad's career the top individual tax brackets were much higher, if fact, over TWICE the present rate!! And capital gains were taxed nearly twice the present rate! America's economy was stronger back then – when the top rate was 94%!!! (1945-1963) This 'Rich for the Rich' tax rate anomoly will end, it has to – but not without a fight!

    January 24, 2012 at 2:42 pm | Report abuse |
    • Nah

      wood: "During my dad's career the top individual tax brackets were much higher, if fact, over TWICE the present rate!!"

      First, tax deductions were also astronomically high. In the 70's and 80's you could write the whole cost of a Rolls-Royce (or even an apartment building) off in a few years.

      Second, when the tax rate was 94%, the definition of "income" was, evidently, quite different.

      January 24, 2012 at 2:46 pm | Report abuse |
  4. concerned

    The problem with Romeny's tax return is not only is his rate of 13.9% super low but his proposed changes to the tax code will not remedy the inequality. He will not pay more under his proposed tax plan. Also why would you have money invested in a foreign country if there is no tax incentive when you are running for President of the United States?! Shouldn't you be investing your job creator funds back into the country in which you live and hope to one day run?

    January 24, 2012 at 2:43 pm | Report abuse |
    • J

      My point exactly. Some believe that the rich's investments are sacred and the prime boost to the economy. But want if that money isn't used to create american jobs? So the invester gets out of higher tax rates with no direct positive to the US economy. Why can't we instead give tax breaks to companies for each american job created.

      January 24, 2012 at 2:51 pm | Report abuse |
    • Nah

      j: "Some believe that the rich's investments are sacred and the prime boost to the economy. But want if that money isn't used to create american jobs? So the invester gets out of higher tax rates with no direct positive to the US economy. Why can't we instead give tax breaks to companies for each american job created."

      Hilarious. You base your conclusion that there should be a higher tax rate on an argument derived from mere speculation about whether or not investment creates jobs.

      What you overlook, however, is the fact that investment (from all members of society) gives the economy the one thing it needs: money. That money is used to prop up new businesses, help struggling ones, and helps to get others off the ground. Those businesses, by necessity, create jobs.

      Much less, when it isn't used to create jobs, but to merely help a company make a new product, the profit that's derived from that investment is, naturally, taxed by the government. And the more money a business makes, the more it'll pay in taxes in the end.

      But no, you're right. Let's tax all investments at 100%. That'll surely spur economic activity and increase revenue at the same time.

      January 24, 2012 at 2:59 pm | Report abuse |
    • J

      What's hilarious Nah is you trying to put words into my mouth. Of course some investmetns create jobs, but not all. And certain investments like the ones stated don't justify far cheaper tax rates. I never said tax them at 100% But there has to be a reasonable limit drawn or at least some direct accountability to insure that those investments are resulting in american job creation. Else they don't justify the loss the gov't takes from tax revenue which this country needs to function.

      January 24, 2012 at 3:15 pm | Report abuse |
    • Nah

      j: "But there has to be a reasonable limit drawn or at least some direct accountability to insure that those investments are resulting in american job creation. Else they don't justify the loss the gov't takes from tax revenue which this country needs to function."

      First, whether someone is creating jobs is not the standard for how much you tax them. Or can the government confiscate your personal savings, or demand that you pay them back the price of every new iPod you buy? I mean, after all, evidently you could afford something as unnecessary as an MP3 player, and that money could help so many poor people.

      Second, you're once again assuming that one part of the population should be burdened with supporting the entire government and government programs that benefit everyone every day. Why is that? Because you're selfish?

      January 24, 2012 at 3:21 pm | Report abuse |
    • J

      I don't know Nah, to I get to write off buying an Ipod and exempt that part of my income from being taxed?

      You are missing my entire point in the rush to create your far-flung hypotheticals: The tax system has lots of mechanisms to get people out of paying their share. These often benefit the highest earners like Romney since they can earn from cap gains, or get write offs through investments. Earners over 1% average $70K in write offs. These practices add to US debt under the assumption that they help the economy in such a great way as to justify them. I believe that the amount of tax break given can be disporportional to the actually benefit to the economy and terms of job creation. There can be more direct ways of giving tax breaks for job creation.

      January 24, 2012 at 3:46 pm | Report abuse |
  5. David

    I am offended that, as an emergency physician performing a vital service in an underserved area, my income has dropped by more than 30% over the last decade, I am still paying on my student loans 20 years after I graduated while unable to deduct the interest, and I pay over 30% tax rate while multimillionaires like Romney pay half that rate while swimming in cash.

    Got to love America.

    January 24, 2012 at 2:43 pm | Report abuse |
  6. PercentageToActual

    It's important to think beyond percentages to actuals. Did it escape us that Mitt pays $3M in taxes every year? How many miles of freeway, how many bridges, how many homeless meals, how many food subsidies did that buy? How many people did that money help? That's more than I'll pay in my entire lifetime even though every April I think to myself that I sure do pay a lot in taxes.

    January 24, 2012 at 2:45 pm | Report abuse |
    • Nah

      Shh..it doesn't help the "tax the rich" agenda to talk about reality.

      January 24, 2012 at 2:47 pm | Report abuse |
    • bobcat

      That is his duty as a sucessful man to do those things, they are a badge of honor; a fulfillment of the social contract on witch our founders laid out for us to follow.

      January 24, 2012 at 2:52 pm | Report abuse |
    • J

      Not as many people as someone who pays the 35% rate on that same amount of income earned by wages. That's the issue. To cap the 15% cap gains tax after a certain amount or not. $3M seems like a lot to us, but not when your earning plus-$20M. We are drowning in debt and their is only two things that can be done 1) cut spending 2) increaase taxes on those who can afford it, without killing collective consumer spending power. We need to do both, not just tax the rich or cut the gov't out of existence.

      January 24, 2012 at 2:58 pm | Report abuse |
    • Nah

      j: "We are drowning in debt and their is only two things that can be done 1) cut spending 2) increaase taxes on those who can afford it"

      And why should the rich pay for the government's debt when that debt was created by government programs that widely benefitted everyone in society?

      Why should the rich be saddled with the burden of supporting the government?

      You may as well argue that they ought to get double the votes as well since they're so invested in both the government, the country and the economy. But you would never accept that, would you?

      January 24, 2012 at 3:02 pm | Report abuse |
  7. Hannah

    If you are to critically look at this article you would see that the entire thing is a red herring. This entire topic of the country's concern with Romney's taxes is irrelevant to the issues that really matter in the campaign. He paid what the law required. So instead of looking at tweets on his taxes and how they compare to tweets about the Oscars we should be focused on how we should change the tax policy if we believe it to be wrong. This article provides little valuable information, because the entire thing distracts our attention from the bigger issue.

    January 24, 2012 at 2:46 pm | Report abuse |
    • LINDY

      Hannah – The fact that Romney has no plans to change a tax code that favors people like him absolutely makes this relevant even if he paid the legal rate. What he should be saying is "there's something wrong with a tax code that allows me to pay so little in comparison". The code needs to tax ANY income whether from investments or income at the same rate.

      January 24, 2012 at 3:03 pm | Report abuse |
  8. Common$ense

    Funny how this wasn't an issue in 2008 elections when Hillary Clinton show she had made $109 Million over the last 7 years. Nobody cried then that she made too much money!!!! And lets not forget Obama is in the top 5% if not the top 2% of wage earners himself.

    January 24, 2012 at 2:47 pm | Report abuse |
  9. Charity?

    Romney's donation to charity was directly to the Mormon Church. Not to "charity" as we know it. As a faithful Mormon he has to give 10% of his income to the Church or he can't wear his magic underwear.

    January 24, 2012 at 2:49 pm | Report abuse |
    • Common$ense

      Thats just you being a biggot. I donate to my church. Some of the money goes for keeping the church going but a lot goes for helping other. If you look at the Mormon Church's charity's (whether you agree with thier doctrin or not) World wide the provide Food, Clothing and Housing to many people in third world countries. I bet the over head for the Church is a lot lower then the over head for out Federal government and what they give away in the form of Forced US charity both local and abroad.

      January 24, 2012 at 3:09 pm | Report abuse |
    • to Common$ense

      I may be a biggot, but you don't knowwhat you're talking about (most people would say that means you're stupid). No one has seen the financials from the Moron Church. How much did they spend of "their" money on the stupid Mall by the Salt Lake Temple? There's a good investment!

      January 24, 2012 at 3:27 pm | Report abuse |
  10. BC

    The real point here is that the people who create or influence the tax laws that we all have to follow have lot's more money than most of us do...probably alot more income from capital gains...they get to write the rules...no suprise that these rules favor this kind of income. The "incentive" argument is just a smokescreen..as the saying goes..."follow the money"

    January 24, 2012 at 2:51 pm | Report abuse |
  11. mm

    Make all the money you want BUT, don't act like you can relate to "normal" American citizens. You don't speak for me and you don't represent me when you don't even know the price of a gallon of milk.

    January 24, 2012 at 2:53 pm | Report abuse |
  12. Ferdinando Saglio

    Why sould not a presidential candidate use all his/her financial assets to pursue the candidacy before dipping into campain contributions and tax dollar funds?. After all, if charisma, character, honesty and drive are the motivating force behind the challenge, monetary assets and rewards should count nothing.

    January 24, 2012 at 2:55 pm | Report abuse |
  13. Brian

    A great deal of it comes down to income, how it is defined, and what is and is not claimed for tax purposes. To me, anything that brings you dollars in a given year should be considered income and taxed as such. It doesn't matter if it's stock sales, freelance writing, a lottery win, dividends, your paycheck, an ebay store, or a bonus. But enforcing tax codes seems a lot like enforcing speed limits. There are millions of drivers, but only so many speed traps. Needless to say the average car on a US highway is not doing the speed limit or less. And if not getting a ticket/points is a priority, someone can go out and buy a top of the line radar detector to help minimize that risk. I say close as many loopholes as possible and tax individuals, families, and companies for what they actually bring in throughout the course of the year.

    January 24, 2012 at 2:55 pm | Report abuse |
  14. My name is Jose Jimenez

    People are missing the larger point. In order for Romney to have amassed this fortune consider how much he must have made at Bain Capital! While gutting companies, sending jobs overseas and possibly creating low paying ones here Romney made hundreds of millions of dollars. Now he can sit back and enjoy the fruits of his labor while thumbing his nose at the rest of you for sitting idly by and permitting Congress to enact tax laws that favor the rich.

    January 24, 2012 at 3:00 pm | Report abuse |
  15. AS1341

    Just a thought. If Mitt is really wanting to be president because he "cares about America" he shouldnt need a paycheck when he does become president. I mean he makes plenty of money as it is what's another $400,000 plus perks? And what about U.S. senators making $175k a year for salary for doing their "civic duty" When they are making a few million a year on their own without it.

    January 24, 2012 at 3:01 pm | Report abuse |
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