Romney’s Democratic and Republican opponents alike pounced on his revelation by saying he has benefited from a basic unfairness in the tax structure. And as President Obama looked to Romney as his likely general-election opponent, the White House and its allies tried to stoke populist anger over income inequality by casting Romney as an out-of-touch multimillionaire.
Romney seemed to strike another clumsy note when he described his income from speakers’ fees — about $370,000 in a single year — as “not very much.”
Most Americans earn their income from wages and salaries, and the more they bring in, the higher their taxes are — up to 35 percent. Obama paid a rate of 26 percent on adjusted gross income of about $1.73 million in 2010, according to his tax return.
Most of Romney’s income, however, has come from capital gains, which include profits from the sale of stocks, bonds and real estate, and are taxed at a rate of 15 percent. Over the past 20 years, the wealthiest one-tenth of 1 percent of Americans have realized about half of all capital gains income — and received tax advantages criticized by billionaire Warren Buffett and Occupy Wall Street protesters alike.
Romney has resisted releasing his tax returns, but under renewed pressure, changed course. He said he would release his 2011 returns in April, but did not say whether he would release any earlier returns.
In discussing this one detail about his personal wealth, the former Massachusetts governor drew more unwanted attention to it — without putting the matter to rest. His remarks ballooned into a major news event on the campaign trail on Tuesday, threatening to overshadow his attempts to win over more South Carolina Republicans four days before the potentially decisive primary.
“What’s the effective rate I’ve been paying? It’s probably closer to the 15 percent rate than anything,” Romney said at a news conference here. “My last 10 years, I’ve — my income comes overwhelmingly from investments made in the past rather than ordinary income or rather than earned annual income.”
Romney, who has not drawn a salary for several years, said he received royalties from his 2010 book, “No Apology,” but added: “I gave that all away. And then I get speakers’ fees from time to time, but not very much.”
Romney collected more than $370,000 for such appearances, averaging more than $40,000 per speech from February 2010 to February 2011, according to a mandatory financial disclosure form filed last summer. Romney — a retired chief executive at the private equity firm Bain Capital — assessed his net worth as $190 million to $250 million.