We talked last week about Mitt Romney’s decision to keep his tax returns hidden, despite the fact that every major-party nominee in the post-Watergate era has released their tax records. Romney’s position has already generated some pushback from Newt Gingrich and Rick Perry, and if Romney wins the GOP nod, Democrats will likely keep this going.
It’s worth noting, however, that Romney isn’t just being secretive for the sake of secrecy — there’s a good reason he’s rejecting transparency. Alec MacGillis flagged this Boston Globe piece, which suggests Romney is, in fact, paying a lower tax rate than nearly everyone else, which probably has a lot to do with his campaign’s decision.
In case anyone needs a refresher, there’s a tax loophole on “carried interest” — sometimes called “the carry” — that taxes private equity and venture capital income at a lower, 15% rate, as compared to 35% on ordinary income. Hedge-fund managers and the Wall Street have fought tooth and nail to protect this loophole — even after the Obama White House tried to eliminate it — and so far, they’ve been successful.
Because Romney still collects seven-figure checks from his vulture-capitalist firm, he’s paying less in taxes than middle-class families nationwide. And with that in mind…
Romney also indicated that he would not shy away from a legal tax break that shelters partners at private equity firms, like Bain Capital, from high tax rates on the largest part of their take-home profits.
“I can tell you we follow the tax laws, and if there’s an opportunity to save taxes, we like anybody else in this country will follow that opportunity,” he said.
Let me summarize the political problem this way:
1. Mitt Romney is worth $250 million.
2. He got rich by laying off American workers.
3. He pays a lower tax rate than you and the rest of the middle class.
4. He wants to be president so he can keep it this way.
I don’t know if voters will find this offensive or not, but it certainly explains why Romney is so eager to keep his tax returns under wraps.
