Published: Thursday, Jan. 26 2012 12:00 a.m. MST
Lets first acknowledge that Mitt Romney has done nothing illegal in obtaining
his vast fortune. Working within existing U.S. tax law, he was able to amass
great wealth for himself as well as his partners and investors. But can we not
make claims of his sainthood by giving false impressions of his intentions?Romneys income for 2010 and 2011 includes about $13 million in carried
interest. Carried interest is a share of the profits of a successful investment
partnership that is paid to the investment manager of the partnership (in this
case, money to paid Romney as part of his buyout at Bain) as a form of
compensation, incentive to maximize performance of the investment fund. Carried
interest is usually referred to as a "performance fee." It's not his
money that is invested, it belongs to his investors. The issue is that this
income is taxed at the same rate as capital gains, or investment income, while
it is actually a fee for services rendered.Which raises the question
- why should Mitt Romney be taxed at a lower rate for his services than I am for
delivering the services of my profession? Thats all.
Don't forget, Romney invests in the Cayman Islands to avoid U.S. taxes
altogether... but that's another point. Yes, it's legal. Good for him!
Clearly, we as citizens have to decide if we want a president who dodges taxes
and engages in practices that only the rich can do. The rest of us 99
percenters have to keep our cash at Zions Bank and pay fees because we live
paycheck-to-paycheck and can't maintain the minimum deposit to avoid user
fees... So the banks exploit us AND the government expects us to pay taxes on
our meager savings if we don't send it to the Caymans.The other
point is, however, should tax code tax LABOR at a higher rate than NON-LABOR.
Since most Americans have to work for a living, is it fair that we have to pay a
higher rate of our income to the government than folks who don't have to work?
The tax rates should at least be equal. I thought the GOP was all
pro flat-tax... what happened to that conversation?
Everyone of us would be paying Mitt Romney's tax rate IF we first paid 35% on
our corporate income - as he has - and then invested the money in people and
businesses - as he has.I can't believe how many liberals are telling
us that he does not deserve to be taxed at 15%. I agree. He has already been
taxed at 35%. Let him, and everyone else, who invests money in people and
businesses have an even lower tax rate. They have proven that they are willing
to invest in people and in businesses. Isn't that what we need MORE of? Don't
we need millions of new jobs? Isn't the lack of jobs the reason that people are
not paying income taxes?If more Americans only paid 15%, there would
be more capital available to start businesses and to hire people. Instead, Mr.
Obama thinks that the best thing to do is to take away that capital and then pay
people to NOT work. He doesn't have a clue about what it takes to create jobs,
but he has proven that he knows how to add $5 TRILLION to the deficit in a mere
Sorry Mike Richards. Mr. Romney did not pay 35% on anything. In case you
missed the news, he released his most recent tax returns which show that he
payed less than 15% because virtually all of his income is derived from
interest, capital gains and carried interest.He has done nothing
wrong. In fact his best contribution to the debate is his willingness to show
how the tax system actually benefits those who are wealthy and have the money to
put into investments while those who get up and go to work every day are
actually taxed at a higher rate. And has been illustrated in my previous post,
a certain part of Mr. Romney's income - $13 million over two years - was not
earned by his own investments but rather was a fee paid for investing other
people's money. As mentioned ad nauseam, Mr. Romney has done
nothing wrong but there is a question of whether these circumstances seem fair
to everyone. Apparently it is fair to some.
ECR,It would be some kind of magic trick to earn interest without
first having a nestegg. That nestegg was taxed at the same rate that you or I
would pay on ordinary income. The government didn't "gift"
him his nestegg. If you have savings or shares in the stock market,
you will have the priviledge of paying twice taxes twice, once when you earned
it and again when you spent you profits.Mitt Romney is not cheating.
He is not "gouging". He paid his taxes. Just because his money NOW
comes from investments does not mean that he never paid the maximum corporate
when that "investment nestegg" was earned.
Thanks to ECR for dispassionately explaining a subject not understood by many.
But just the fact that all this wealth was amassed legally says that the
financial/tax system of this country is tipped to favor the wealthy. This
shouldn't surprise us. After all, they are the ones with the lobbyists on their
side, checkbooks our for legislators who see things their way.BTW,
it's only deeply devoted Republicans who have the nerve to refer to the process
of stripping out assets and job destruction using others' money as
Mike Richards | 9:30 a.m. Jan. 26, 2012 As you have pointed out, too
many times to say on this site. Businesses do not pay taxes. They just pass
their tax cost onto customers.So Mitt Romney did not pay 35%, and then
another 15%. He paid a tax rate of 15%. Which is much less then most tax
paying americans.So if we want the super rich to pay their fair share. We
must tax then on their individual income at a higher rate, without regards to
what the business they own, or work for pays.
I like Mitt but, so far as this debate on taxation is concerned, it is my
understanding that corporate tax is simply passed on to the consumer and we all
pay it, even the poorest consumer.Corporate taxes make the USA much
less competitive than it could or should be internationally, and makes us all
poorer. It seems to promote a common disadvantage to all of us. It would
promote the general interest to eliminate it entirely.
I believe that the statement the a person has already paid tax on the capital
gains income is a lie. The part of the investment, as one calls it
a nestegg, is the only part of the investment previously taxed and it is not
taxed again as a capital gain.Each year as I prepare my income tax I
receive notices from banks about the interest my accounts have earned and which
they have credited to my accounts. While it sure seems that the interest is
like a capital gain, I pay my normal rate of income tax on that money. All income is income, no matter what the source.The amount of tax
on capital gains has little if any effect on investments. People
who refuse to pay their fair share of the cost of our government should be
called criminals and dealt with accordingly.
To really encourage investment in Americans, let's reform the tax code to
eliminate all taxes on income and investment and tax only consumption. Check
out the ideas at fairtax dot org. That way tax policy would encourage savings
and investment, then when you build a nest egg you won't be taxed again on that
investment income. You only would be taxed when you consume. The enviros
should like that too. Consumption could be taxed, and thereby discouraging
consumption. To eliminate the regressiveness we allow prebates for those with
the smallest income. This would be fair for everyone.
OK Mike. So I've see you've decided to refuse to learn something other than
your own opinions. But just because you say something over and over again..with
emphasis...doesn't make it true. The facts are that a portion of
the income Mr. Romnety earned was not derived from interest in an investment, it
was a fee called "carried interest" - similar to the fee a doctor gets
or an engineer gets or an IT technician gets for services rendered - paid to Mr.
Romney (or his old partners at Bain) for investing other peoples money. And
although I don't know, I would assume that the other interest income he received
for his total income was paid on investments he earned in the past in the same
manner. If that is the case then none of that was taxed at 35%, but rather at
the lower rate of 15%. You are right to say he didn't cheat or gouge anyone and
he paid the tax that was owed. But the tax system favors those who earn there
livlihood from interest on wealth and punushes those who earn their income from
blood and sweat. That you cannot dispute. That's all I'm saying.
It amazes me how many people comment that the tax rates are unfair because Mitt
pays 15% overall, while they shoulder the burden of 30%. I would like to see
people actually report what their personal overall federal taxes are before they
through out just top tax brackets.I just completed my 2011 taxes and
here are the results:Gross Income: $71,618AGI: $62,062Taxes
withheld: $3,176Refund: $3,940I paid 0% taxes for 2011. I do
have three children under the age of 17 which helps a lot; but bottom line I
think most people pay under 15% overall.
This writer doesn't understand that you get taxed on your income. An investor
pays 15% on investment income over and above any salaries, which are taxed at a
much higher rate. Mitt is NOT being "double taxed."
I may be misunderstanding this but to say: let's not tax our incomes until we
try to spend them , is puzzling to me. What is the point of an
income unless we exchange it for items of usefulness and value. We need to rein
in government spending and stop taxing our incomes OR taxing our spending to
fund the often counter-productive causes of our princes or rulers.
Capital gains taxes only apply to the profit, not the amount invested. There's
no double taxation and the only reason you didn't hear the media say it is
because the media tends to not lie (unless it's Glenn Beck whose producer has
said that, then it's not lying, just ignorance).
@Mike RichardsHe didn't "already pay 35%". Here's how this
works. Romney has a million dollars he invests that he paid 35% on. That million
becomes 2 million which he takes out. That first million that he invested and
paid 35% on does not get taxed any. The second million is what gets taxed at
15%. So with his first million taxed at 35% and his second million taxed at 15%,
the overall average tax rate he paid on his two million is 25%. There's no 35%+
in here. If Romney reinvests that 2 million somewhere and it becomes 4 million
he's not taxed on the first two million, just the second two million at 15%. Now
he's paid 35% 15% 15% and 15% on his 4 million dollars and his overall tax rate
is just 20%. You have a bank savings account, which gains interest,
albeit at a rediculously low rate. You have to report that interest on your tax
return because it's earned income and subject to the 15% tax. That tax doesn't
apply to the amount you "invested" in the savings account, just the
Just because something may be legal does not mean that it is right. Romney is an
extremely fortunate man who America has made rich, but what has he given in
return: he has never worked at a real job, he has never lived or associated with
average citizens, he is and elitist who avoided military service, he has no
record of community service, he has no record of concern for helping the less
fortunate or sticking up for the common man, he is content to strip others of
their goods to enrich himself. He has more in common with the ambitions of a
king than a president of a democratic people.
re: Mark l 10:09 a.m. Jan. 26, 2012"To really encourage
investment in Americans, let's reform the tax code to eliminate all taxes on
income and investment and tax only consumption."Agreed but
it'll never happen as it makes too much sense. The unintended bonus
is might shrink the government i.e. reduce the size of the IRS & SEC.
Republican elitists like Romney are so far out of touch with Middle and Lower
America.If he finally wins the GOP nomination -- I can hardly wait
for the "How much is a gallon of milk, or loaf of bread" questions
he's gonna get. ala, George HW Bush in 1992.I'd bet he would have a
better idea of Middle America if he'd just lost $100 Million a year for the last
3 years -- on HIS investments like the rest of did in housing!Let
them eat cake....
Huh? Are you saying that investment income is double taxed? This seems to be
an apologist argument for the rich paying less than the middle class. If Mitt's
money was in active rather than passive investments, I would be more
sympathetic. But where has it been shown that his accounts in the Caymans or
Switzerland are creating jobs?
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