Romney says his effective tax rate is 15%
January 17th, 2012
12:00 PM ET
11 years ago

Romney says his effective tax rate is 15%

Florence, South Carolina (CNN) - Mitt Romney said Tuesday he pays roughly a 15% effective tax rate on his income - an acknowledgment that the multi-millionaire pays a smaller percentage of taxes on his income than many middle-income Americans.

"It's probably closer to the 15 percent rate than anything," Romney told reporters when asked about his effective tax rate. "The last ten years my income comes overwhelmingly from investments made in the past rather than ordinary income or rather than earned annual income."

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The information came as his opponents ratcheted up pressure on the GOP front-runner to release his tax returns in a debate Monday night – a disclosure that is not required by law and one Romney has been reluctant to make. Some Americans of far more modest means pay a 15% marginal tax rate on income, while the highest tax bracket tops out at a 35% marginal rate. Because Romney's income comes primarily from investments, it is taxed at a much lower rate.

The candidate, a former chief of private equity firm Bain Capital, went a step further Tuesday and committed to releasing his tax returns in April if he were to become the GOP nominee.

"We'll wait until the tax returns for the most recent year are completed, then release them," he said.

Romney said he had donated the "little bit of income" he earned from his book, "No Apologies," and said occasionally he had been paid fees to speak at events.

The candidate was also elaborated on his views on super PACs, independent political action committees that can raise unlimited funds to advertise on behalf of a candidate. A campaign cannot share strategy with a super PAC.

Romney said he had both encouraged and raised money for his super PAC, and said both former Sen. Rick Santorum and former House Speaker Newt Gingrich had done so as well. He added that although he did not like the existence of super PACs, he would not "disadvantage" his campaign by not taking advantage of the process.

"I wish that law were not as it is. I wish we could just raise money for our campaigns instead of having to create super PACs," Romney said. "I think the whole idea of these PACs becoming larger than the campaigns themselves is a very bad idea."

Gingrich has faulted Romney for failing to publicly denounce attack ads aired by a super PAC supportive of Romney's candidacy, Restore Our Future.

In the press conference, Romney did defend some of the charges made against other candidates by Restore Our Future, including a dig at Gingrich for ethics violations and for his participation with former House Speaker Nancy Pelosi on a climate change awareness initiative, and an ad that charged Santorum supported allowing felons to vote.

"I hear that Rick Santorum is very animated that the super PAC ad says that he is in favor of felons voting, well he is!" Romney said. "What's he missing? That's his position."

The press conference was not without several light moments. After walking to the microphone, Romney first called on his wife, Ann, who had been talking with reporters.

"Where'd the skinny jeans go?" she asked her husband, who did not answer the question.

Romney also weighed in on a campaign commercial aired by Comedy Central comedian and host Stephen Colbert. The ad jokingly calls Romney a "serial killer."

The candidate said he had not seen the ad but admitted of Colbert: "he has a tradition of being able to touch my funny bone."

CNNMoney's Charles Riley contributed to this report.

Filed under: 2012 • Mitt Romney • Taxes
soundoff (194 Responses)
  1. Rudy NYC

    Gov. Romney might be smug and evasive, but he's not stupid. He knows that the longer he waits actual tax returns, the worse it will look on his part. 15%. Is this announcement supposed to appease us?

    January 17, 2012 12:05 pm at 12:05 pm |
  2. Mikey

    So, he too, like Warren Buffet probably pays a lower portion of his income than his secretary – or than almost all of the rest of those with enough income to pay taxes at all. Of course, he does not see that this just might be unfair. In fact, he is pushing tax proposals that would even make that differential bigger. Is his motto, "I have power, so I aim to tilt the table in my direction. All you little people don't have power, so tough bananas for you." So much for government for the people. It has now become government for the powerful. Vote for Romney if you want things to get even worse.

    January 17, 2012 12:11 pm at 12:11 pm |
  3. GI Joe

    15% effective (minus loopholes, deductions, etc. means he pays 0%).

    January 17, 2012 12:13 pm at 12:13 pm |
  4. Larry L

    He pays a much lower rate than my family – a retired military man.

    January 17, 2012 12:15 pm at 12:15 pm |
  5. Joe from CT, not Lieberman

    And not only does he pay less taxes than the rest of us, based on the percentage of what he earns, he also enjoys the privilege of being able to fire his health care provider. I wish I had those problems.

    January 17, 2012 12:19 pm at 12:19 pm |
  6. kakaraka

    So he cries everyday about higer taxes but only pay less than 15% himself on his multi-million dollars income? Really? Romney is the most dishonnest politician I ever known. Such character issue is troubling for an American president hopeful.

    January 17, 2012 12:20 pm at 12:20 pm |
  7. Ndy Ukwe

    I think this announcement will only serve to re-open the floodgates of the Buffet Rule argument once again. Americans should their breath until he releases his tax returns...there might be more surprises then...

    January 17, 2012 12:23 pm at 12:23 pm |
  8. john

    It should be zero percent. This money was already tax at the higher rate once when it was initially earned. Why does the media insist on keeping the public ignorant?

    January 17, 2012 12:23 pm at 12:23 pm |
  9. Noodle Nose Johnson

    I used to think Romney was just an arrogant tool. I'm starting to believe he is a complete sociopath. He seems to be able to hold two completely conflicting ideas in his head and doesn't see any contradiction. It comes out as flip flopping but it all points to a desire to rule, not lead. He's dangerous.

    January 17, 2012 12:24 pm at 12:24 pm |
  10. Hongli

    This is the beginning of the end for Mitt Romney. When the Middleclass is taxed to their limit look what the Joker is paying in taxes. Don't let the door hit you when you jump off that table and make the exit in Florence S/C.

    January 17, 2012 12:24 pm at 12:24 pm |
  11. Bill

    I feel you pain Mittens. Out of touch and unelectable.

    January 17, 2012 12:25 pm at 12:25 pm |
  12. cali girl

    I heard on a talk show that his tax tier is in the 9-10% range. Was the 15% supposed to make us feel better?

    January 17, 2012 12:26 pm at 12:26 pm |
  13. R

    "Is this announcement supposed to appease us?"

    It should, since he's not required to divulge any tax information at all.

    January 17, 2012 12:27 pm at 12:27 pm |
  14. Dominican mama 4 Obama

    Daaaang Mittens!
    It must be good to be a king oooh la la.

    January 17, 2012 12:28 pm at 12:28 pm |
  15. The Elephant In The Room

    I`m willing to bet that even when working @ Bain, he finnagled his annual slary income to avoid it being classified as "ordinary income".

    That`s why we need to see his tax returns of past years. There is no defense for him paying 15% while teacher, plumbers, factory workers, etc. pay higher rates.

    January 17, 2012 12:29 pm at 12:29 pm |
  16. Nellie Bly

    GI Joe–
    15% effective (minus loopholes, deductions, etc. means he pays 0%).
    I was thinking the same thing.

    January 17, 2012 12:29 pm at 12:29 pm |
  17. teena

    15%????? Wow, I wish I had THAT tax rate!

    January 17, 2012 12:33 pm at 12:33 pm |
  18. ST

    Is this what they call leading by examples??? I was wrong when I thought the really vetting started last year. Now I can smell it not from far coming in a good speed!

    January 17, 2012 12:36 pm at 12:36 pm |
  19. Rudy NYC

    john wrote:

    It should be zero percent. This money was already tax at the higher rate once when it was initially earned.
    When was it initially earned? They call it *income* for a reason.

    January 17, 2012 12:37 pm at 12:37 pm |
  20. Eliza Wyman

    Oh, Mitt, you are so out of touch from taxes to Tupperware. You are one of the gazillionaires who should be taxed at a graduated rate based on your total net take per year – how bout 99% tax rate? Even that would not be justice.

    January 17, 2012 12:41 pm at 12:41 pm |
  21. Donut Burger

    He paid 15% on his earnings from profits of his company, which got the money from investors. He used someone elses money and made millions and only paid 15% and you want him to pay your eyes man...


    It should be zero percent. This money was already tax at the higher rate once when it was initially earned. Why does the media insist on keeping the public ignorant?"

    January 17, 2012 12:41 pm at 12:41 pm |
  22. Fair is Fair

    GI Joe

    15% effective (minus loopholes, deductions, etc. means he pays 0%).
    The term "effective tax rate" defines the ratio of tax to taxable income. It takes into consideration all deductions and credits, both refundable and non-refundable. Please try to keep up.

    January 17, 2012 12:44 pm at 12:44 pm |
  23. Bulworth

    “When plunder becomes a way of life for a group of men living together in society, they create for themselves in the course of time, a legal system that authorizes it and a moral code that glorifies it.”
    – Frederic Bastiat

    January 17, 2012 12:44 pm at 12:44 pm |
  24. Armand

    Newt helped create 11 million jobs, and he can back that up, because while he was speaker they did create 11 million new jobs. They paid off $400 billion worth of debt, they balanced the budget in four years, and they reformed welfare. That's a record to run on.

    January 17, 2012 12:45 pm at 12:45 pm |
  25. Rob

    It should not be 0%, then all small business should have 0% rates under that logic, they're earning their income the same way, investing their own money in a business, earning a return.

    Also a hedge fund managers job is to earn returns, it is a job, so income should also be taxed as regular income, not capital gains, it is a job!!!!

    January 17, 2012 12:46 pm at 12:46 pm |
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