The Media’s Wrong: Romney Really Paid 50% In TaxesSeptember 21, 2012
Today has been incredibly disturbing for anyone who understands on a basic level how taxes work. The NY Post, Marketwatch, The NY Times, and even the Wall-Street Journal have posted news stories about how Romney the evil robber baron has only paid “14%” in taxes. This is leading to outrage in the middle class, as people realize that’s a “lower number” than what they pay.
It’s also misleading. Romney’s overall tax rate is over 50%. The lower-sounding number is being used because it makes a great story — even if it only tells part of it. It’s surreal.
Fine. If no one else will respond to this media manipulation, I will. This is not an endorsement of Romney — Capitalism Institute will not endorse any candidate this year. But this absolutely is a defense of the notion that Romney is paying very high and overbearing taxes, just like everyone else. We hate all taxes, and support abolishing all income taxes.
The Truth About Romney’s 14% Rate
How on earth is he only paying 14%? Because the media is ignoring two things:
- Double Taxation Ignored. He paid shareholder taxes. His money is in companies, and he’s paying taxes as a shareholder – up to 39%. This is not counted. And it should be counted.
- Charity Deductions Ignored. He gave a third of his income to charity, and they’re ignoring this. In other words, if you make a million dollars and give all of it to charity, they would be complaining that your tax rate was “nothing”. Uhm. It’s “lower”, because you bloody gave your bloody money away. That’s a good thing. You don’t “get” a dime of the money you made. Apparently, this is still evil to the crazy leftists who spend all day whining about the rich not giving enough in charity. They’re just being dishonest.
How Romney Really Paid 50%+.
Romney’s adjusted gross income was $9,676,179 in 2011. In other words, this is how much money he made over what he gave in charity. This is ignoring deductions he received that other Americans qualify for, like medical costs and such. So how much did he pay in personal income taxes alone, not yet counting shareholder taxes?
20% of that: $1,935,708. Only a socialist would think being forced to pay millions of dollars is “not fair” in America.
And no, we’re not done — that’s just when you account for his charity alone. And yes, charity is a good thing… unless the leftists and socialists want to admit they hate charity too?
The reason we’re not done is because his income was, for the most part, from investments. He owns parts of companies as a shareholder and investor. And as an investor, he has to pay an extra layer of taxes. I’ve explained this before. Corporations don’t exist independent of human beings. It’s an association of people. When you tax a corporation, you’re really just taxing the shareholders — the investors who own the company. That means Romney-like people, as well as middle-class people saving for retirement.
So Romney paid double taxation, and the media’s reporting only half of it. That’s like me shooting you in the left leg, then me shooting you in the right leg, and then trying to inform you I only shot you in the right leg once. Sure, but you’ve been shot twice — and counting only one is weird and is dishonest. Count both layers of taxation.
So what’s the corporate tax rate he’s paying as a shareholder? It’s 39.5%, roughly. This doesn’t account for state corporate income tax or fees or accounting costs or even lost opportunity costs.
This means that, roughly speaking, Romney is paying about 50 cents on every dollar he earns and keeps, and that’s being extremely conservative about it. The real cost is likely much higher, meaning Romney is only receiving a fraction of the income he generates in this culture of theft. There’s no way to account for double taxation completely, because it gets really hairy figuring out the numbers. That’s great news for leftists who want to manipulate data to make giving to charity mean you’re evil and greedy.
If you only read headlines from the mainstream media, you’d never know it… you’d think his taxes were lower than what most Americans pay. This is, of course, ludicrous. Most rich people are paying incredible amounts in taxes, and the media is trying to repaint this by messing with the numbers — and that’s truly a shame. It’s dishonest.
In the end, Romney paid over half of his real income in taxes. He’s overtaxed like most Americans… but because he’s a successful man, people hate his income. Pathetic. There are real problems with Romney, but him paying “too little” in taxes isn’t the problem. The financial journalists of the world should be ashamed right now.