Former Massachusetts governor Mitt Romney (R) has millions of dollars invested in a Cayman Islands registry that allows him to reap benefits he otherwise would not receive, ABC News reports.
The news comes one day after Romney publicly estimated that his tax rate is about 15 percent and downplayed the $370,000 he has received in speaking fees over the past year. The highest income tax rate on wages and salaries is 35 percent.
A Romney spokeswoman called the ABC News report “flat wrong” and said that the campaign has requested a correction.
“The Romneys’ investments in funds established in the Cayman Islands are taxed in the very same way they would be if those funds were established in the United States,” Romney spokeswoman Andrea Saul said in a statement. “These are not tax havens and it is false to say so.”
ABC News’s Matthew Mosk, Brian Ross and Megan Chuchmach report:
In addition to paying the lower tax rate on his investment income, Romney has as much as $8 million invested in at least 12 funds listed on a Cayman Islands registry. Another investment, which Romney reports as being worth between $5 million and $25 million, shows up on securities records as having been domiciled in the Caymans.
Official documents reviewed by ABC News show that Bain Capital, the private equity partnership Romney once ran, has set up some 138 secretive offshore funds in the Caymans.
Romney campaign officials and those at Bain Capital tell ABC News that the purpose of setting up those accounts in the Cayman Islands is to help attract money from foreign investors, and that the accounts provide no tax advantage to American investors like Romney. Romney, the campaign said, has paid all U.S. taxes on income derived from those investments.
“The tax consequences to the Romneys are the very same whether the fund is domiciled here or another country,” a campaign official said in response to questions. “Gov. and Mrs. Romney have money invested in funds that the trustee has determined to be attractive investment opportunities, and those funds are domiciled wherever the fund sponsors happen to organize the funds.”
The ABC News story is the latest report related to Romney’s wealth with which the candidate’s campaign will have to contend on the campaign trail.
That the news comes in the primary campaign – as opposed to during the general election – could be a boon for Romney, his party’s frontrunner heading into this Saturday’s South Carolina primary. By having the information revealed earlier rather than later in the campaign, Romney’s camp has the benefit of time in crafting its response.
On the other hand, the story also comes as a new CNN/Time/Opinion Research poll shows the former Massachusetts governor’s lead over former House speaker Newt Gingrich (R-Ga.) narrowing in the Palmetto State.
The latest survey shows Romney taking 33 percent to Gingrich’s 23 percent. Earlier this month, Romney led with 37 percent to Gingrich’s 18 percent and former senator Rick Santorum’s (R-Pa.) 19 percent.
Staff writer Philip Rucker also contributed to this story.