President Barack Obama released tax forms on Friday that reveal he will probably pay a higher tax rate on lower income than likely Republican opponent Mitt Romney in 2011, adding fuel to a Democratic election-year effort to raise taxes on the wealthy.
Obama paid an effective tax rate of 20.5 percent on income of $789,674 last year, the White House said. Romney has estimated he will pay a 15.4 percent tax rate on income of $20.9 million, though he has not filed his return yet.
Obama and his fellow Democrats have spent much of the week touting the “Buffett Rule,” a plan to ensure that millionaires like Romney pay at least 30 percent income tax.
The proposal has almost no chance of overcoming Republican opposition in Congress, but it will provide ammunition for the November 6 presidential and congressional elections as Democrats say their rivals are more concerned with protecting the wealthy than addressing the concerns of less affluent Americans.
Obama’s campaign also aims to exploit the fortune Romney earned over decades as a private-equity executive, valued at up to $250 million.
Campaign manager Jim Messina highlighted the tax shelters and offshore accounts Romney has used to manage his money, and challenged him to release tax returns that would shed more light on his career as head of investment firm Bain Capital.
“What does he have to hide?” Messina said in a statement. “Why did he open a Swiss bank account instead of an American bank account and establish a corporation in Bermuda instead of on our shores?”
Romney pays a lower tax rate than Obama because the Byzantine U.S. tax code favors investment income over wage income, and his lawyers say he fully complies with the law.
Read more at Reuters….
Ben Cohen is the editor and founder of The Daily Banter. He lives in Washington DC where he does podcasts, teaches Martial Arts, and tries to be a good father. He would be extremely disturbed if you took him too seriously.