Mitt Romney has bowed to pressure and released his tax returns for the past two years. They reveal he paid about 14 percent of his multimillion-dollar fortune in federal income tax, well below the national average.
Romney's campaign reportedly planned to release the forms today, but gave the Wall Street Journal and Washington Post a preview late last night.
The Republican presidential hopeful declared an income of $21.7 million in 2010 and $20.9 million in 2011. According to the Post:
None came from wages, the primary source of income for most Americans. Instead, Romney and his wife, Ann, collected millions in capital gains from a profusion of investments, as well as stock dividends and interest payments.
Some of those investments were overseas, the WSJ reported, and Romney has financial accounts in Bermuda and the Cayman Islands. He also had one in Switzerland that was declared closed in 2010.
In 2010, Romney paid about $3 million to the Internal Revenue Service, which the Post calculates as an effective tax rate of 13.9 percent. For 2011, he estimates he will pay $3.23 million, which works out at 15.4 percent.
That rate confirms Romney's previous public statements – he said last week he was taxed "closer to the 15 percent range" – but is nonetheless a smaller percentage than what many middle-class Americans pay in tax. According to the WSJ, the top rate on income from long-term capital gains and dividends is typically is 15 percent, while regular salary income is taxed at a top rate of 35 percent.
Romney is keen to stress not the percentage but the sheer size of his tax bill, which puts him near the very top of US taxpayers, according to Bloomberg. At a debate in Tampa, Florida, last night he said:
"You’ll see my income, how much taxes I’ve paid, how much I’ve paid to charity. I pay all the taxes that are legally required and not a dollar more. I don’t think you want someone as the candidate for president who pays more taxes than he owes."
"I’m proud of the fact that I pay a lot of taxes."
Romney gave away over $7 million in charitable contributions over the past two years, according to his tax forms, at least $4.1 million of it to the Mormon Church.
Yet Romney's tax returns have set up a clear line of attack for his opponents both within the Republican party and among the Democrats. Tax fairness is shaping up to be a major theme of Barack Obama's campaign for reelection, and now he can prove he pays a significantly higher rate than the man long considered the most likely Republican presidential nominee.
White House press secretary Jay Carney told reporters yesterday:
"The president believes that it is not fair – inherently not fair – that those who are millionaires and billionaires pay at a lower rate than average Americans who are struggling to get by."
Meanwhile Romney's main rival for the Republican nomination, Newt Gingrich, paid an effective tax rate of about 31 percent last year, Reuters reported.
Romney's campaign said it would release the tax returns in full and discuss them in detail later today, according to the Associated Press. Campaign officials have refused to release details of Romney's taxes prior to 2010, before he knew he would be running for president again.