Romney in Las Vegas. (AFP)
Sept. 22: Mitt Romney responded to months of political pressure today by making public his most recent tax return and limited information from previous years, asserting that he had paid a double-digit federal income tax rate for more than two decades.
Romney’s return for 2011 showed that he paid an effective federal income tax rate of 14 per cent last year, or a little more than $1.9 million on adjusted gross income of about $13.7 million.
A letter from his accountants said his tax rate from 1990 to 2009 had never fallen below 13.66 per cent but did not disclose the amount of tax paid. Romney’s 2010 return, which he made public in January, showed that he paid a rate of 13.9 per cent.
Romney’s tax return for last year showed just how sensitive a political matter his wealth and tax rate has become. In a bit of reverse financial engineering, he and his wife, Ann, gave up $1.75 million worth of charitable deductions, raising his tax payments significantly.
Had he claimed all the deductions to which he was entitled in 2011, his effective rate could have dipped to near 10 per cent, contradicting his past assurances that he had never paid below 13 per cent.
But forgoing the full deductions available to him put him at odds with his own past assertions that he had never paid more taxes than he owed and his statement that if he had done so, “I don’t think I’d be qualified to become President,” as he put it to ABC News in July.
Romney had pledged to disclose his 2011 return before Election Day, and his campaign said it was filed yesterday with the Internal Revenue Service. His aides appear to have judged that any political harm from releasing the new documents would best be timed for the end of a week that had been among the most difficult of his campaign.
While the release of some figures for the previous two decades went beyond what Romney had signalled he would be willing to disclose, it remained impossible to get a complete picture of his tax liabilities from those years without his returns. Democrats quickly pounced on Romney’s decision to release only average figures for his 1990-2009 returns, leaving many details of his finances and tax planning unclear.
In a statement, Stephanie Cutter, the deputy campaign manager for President Obama, said that Romney “continues to fail” the test of full disclosure by releasing only a summary of his earlier returns. Harry Reid, the Senate majority leader, who had accused Romney of having paid no taxes for a decade, did not repeat his claim yesterday — but did not back down either.
“When will the American people see the returns he filed before he was running for President?” Reid said in a statement. “Governor Romney is showing us what he does when the public is looking. The true test of his character would be to show what he did when everyone was not looking at his taxes.”
The Romney campaign took questions about the new documents only over email, and a memo from his lawyer, R. Bradford Malt, left unanswered questions that have swirled about Romney’s overseas income, foreign tax credits and use of sophisticated corporate structures abroad to minimise his tax burdens at home.
A campaign spokeswoman did not respond to questions about which years Romney or the family trusts had filed separate forms with the Internal Revenue Service.