Harry Reid is still bringing up Romney’s taxes. Here he is a few days ago:
Senate Majority leader Harry Reid tells George Knapp of KLAS his “source” is a “long time friend, a very wealthy person he’s known for 30 years who’s had business dealings with Bain Capital.” He told him Romney “hasn’t paid taxes like you and I for 10 years.” He adds, “he can’t give us his tax returns because it would be the end of his campaign for sure”
The end of his campaign eh?
Well, that bastion of conservative thought, the New York Times, disagrees:
Mr. Romney has insisted that his returns from 2010, and preliminary returns for 2011 (until he provides a final version) are enough for voters to evaluate his fitness for office. But even though he has not released his returns from earlier years, the 2010 return sheds some light on those years.
That’s because Mr. Romney paid income tax to foreign countries, and as result claimed in 2010 a $129,697 foreign tax credit, which he used to offset taxes he owed in the United States. American taxpayers who claim the foreign tax credit are required to report their total foreign taxes paid and tax credits used for the previous 10 years. So that return contains foreign tax data going back to 2000.
The good news for Mr. Romney is the forms suggest that he paid at least some federal income tax every year, as he has said he did. He used the foreign tax credit every year to offset his taxes in the United States, and American taxpayers can’t use a tax credit if they owe no federal income tax. This casts even more doubt on the claim by the Senate majority leader, Harry Reid, attributed to an unnamed Bain Capital source, that Mr. Romney paid no income taxes during that time.
Of course they have to throw an elbow here or there:
But the data does suggest that Mr. Romney was able to reduce his taxable income in 2009 to a very low level, and thus might have paid relatively little tax — even if it did, as Mr. Romney claims, amount to at least 13 percent of his taxable income. Tax experts also said it is theoretically possible, though highly unlikely, that he paid no federal income tax in 2009. At the same time, an unusually high foreign tax credit in 2008 raises questions about the size and source of Mr. Romney’s foreign income that year and how it was treated for tax purposes.
I find it hard to believe that someone would want to reduce their taxable income….oh wait:
[Diane] Feinstein. OpenSecrets.org lists her as the seventh-wealthiest senator, with a net worth between $44 million and $94 million, according to her latest disclosure forms. And, just like Romney, she keeps a portion of it in offshore accounts. Her most recent reports say she has an unspecified amount (at least $1 million) “held independently by the spouse or independent child” in Coral Growth Investments, Ltd., in St. Peter Port, Guernsey. Guernsey, a tax haven, is a small island in the English Channel that early this year drew the ire of a British Labour-party leader for helping wealthy Brits dodge taxes. The California senator also has between $500,000 and $1 million in a fund called Cevian Capital II L.L.C. in Jersey, another of the Channel Islands. According to her latest forms, that holding generated between $15,000 and $50,000 in capital gains, interest, and dividends. Feinstein has another $1,000 to $15,000 in Mauritius, an island nation in the Indian Ocean off Madagascar that is an up-and-coming tax haven.
Like Feinstein, Richard Blumenthal is on the Senate Judiciary Committee. Also like Feinstein, he has sheltered funds from taxes in the past — $15,000 to $50,000 in a hedge fund held by his wife in the Cayman Islands, to be exact. That might not sound like a huge number, but his most recent disclosure forms say he made $50,000 to $100,000 from the fund in capital gains, dividends, and interest…
[Frank] Lautenberg appears to be in a similar situation. The New Jerseyan is the fifth-wealthiest senator, with a net worth that, in 2006, was six times the Senate’s average. His most recent forms show that his wife’s family has between $500,000 and $1 million in Port Louis, Mauritius. The money is in a real-estate private-equity fund that does its actual investing in India, and the earnings it generates are subject to taxes, as one of his representatives told National Review Online.
…Then there’s John Kerry, the richest person in the Senate. He is considered wealthy because of the fortune of his wife, ketchup heiress Teresa Heinz Kerry, whose wealth came largely from her previous husband, Henry John Heinz III. The senator’s 2010 disclosure forms (the latest available online) show that she had at least $2 million in a fund in Guernsey at filing time.
Note, these figures come from disclosure forms. They didn’t release their tax records.
In the end this is all about trying to make the rich into villains which I really don’t understand. The rich took risks to become successful and wealthy. They worked hard. Good for them. Why make them out to be the bad guy? As I’m sure you have heard time and time again, not ONE poor person has given you a job.
But instead people in this country want to penalize those who make more money than they do. According to this new Pew poll 58% of Americans believe the rich don’t pay enough in taxes. So 58% believe that the richer someone gets the more they should pay, percentage wise, then they do. That’s jealousy folks. That is someone who doesn’t like the fact that someone else makes more than them. How else to explain it? Is it fair for the middle class guy down the street to pay 15% in taxes but force the rich guy to pay 30%? All the while the poor guy sitting at home collecting welfare pays next to nothing in taxes?
But it will help balance the budget says the envious. Again….nope:
Want to balance the budget on the backs of the top 1 percent? According to CBO figures, the government would need to tax them at a rate of almost 100 percent. But doing so would make the top 1 percent poor — so, next year, the government would have to tax the top 2 percent.
This is where the middle class comes in. Politicians know the real potential for tax revenue lies with the middle class. Middle-income Americans far outnumber the rich and, at least for now, are taxed at relatively low rates. But even if we tapped the middle class, we’d have to raise tax rates by a staggering amount.
To balance the budget, we’d have to triple tax rates on every household earning over $100,000. Alternatively, we could merely double tax rates, but we’d have to do it on every household earning over $75,000. Not only are there not enough rich households to tax, there are barely enough middle-income households.
With the top 2 percent taxed into poverty, the year after that, politicians would need to go after the top 3 percent. Keep going down that path and, eventually, they’ll come for you.
In fact raising taxes to penealize the successful…er, I mean to “balance the budget” will just ensure we go further into recession [pdf]:
Fiscal adjustments based upon spending cuts are much less costly in terms of output losses than tax based ones. In particular, spending-based adjustments have been associated with mild and short-lived recessions, in many cases with no recession at all.Instead, tax-based adjustments have been followed but prolonged and deep recessions. The difference is remarkable in its size and cannot be explained by different monetary policies during the two type of adjustments. In fact,we find that the mild asymmetric (and lagged) response of short-term rates cannot explain the difference between the two types of adjustments: heterogeneity in the response of monetary policy appears with a lag of one to two years, while the heterogenous response of output growth to EB and TB adjustments is immediate. We find that the heterogeneity in the effects oft he two types of fiscal adjustment (tax-based and spending-based) is mainly due to the response of private investment, rather than that to consumption growth.
But dammit…it’s just not fair!