Mitt Romney has every right not to like the line of questioning expected to come his way in tonight’s presidential debate. His income tax returns, especially what they might reveal about his offshore investments in the Cayman Islands, is a subject he obviously doesn’t like to talk about. Expect him to try and change the subject into an attack on President Obama or his GOP opponents.
But Romney’s tax bill isn’t something to be dodged. And tonight, two days before the South Carolina Republican primary is as good a time as any to shed light on how the richest presidential candidate in Republican Party history made and has managed to hold onto his money.
It’s not a question of nosiness or envy of the rich. At issue, as noted in a Wall Street Journal article today by Mark Maremont, is whether Romney used his offshore holdings to help him “avoid paying an obscure but hefty tax of as much as 35% on some of those investments, held in a tax-deferred account.” That obscure but hefty tax is the “unrelated business income tax” which, as Maremont reported, is intended to stop tax-exempt entities, such as instruments owned by Romney, from “unfairly competing with for-profit, taxpaying entities by operating a business without paying taxes on it.”
To say, as the Romney campaign does, that the former Massachusetts governor and Bain Capital executive’s investments are in compliance with the rules doesn’t answer the question of whether Romney was practicing a little (or big) tax avoidance.
Expect the moderators or Newt Gingrich and Rick Santorum to pursue Romney’s financial dealings. It would be a shame if they didn’t.