Forgive Republican candidate Mitt Romney for his alleged failure to adequately explain why he paid “only” 14 percent of his income in taxes.
The honest answer — “Well, because my accountants couldn’t figure out how to get them any lower” — does not work in this or very many other election years. Romney seemed flat-footed because, like most business people, he seeks to minimize costs and expenses.
This includes taxes.
A normal wealthy-and-proud-of-it guy would have said: “Let me get this straight, pal. I’m not supposed to take every legal advantage provided me by the tax laws to reduce my taxes?” For what it’s worth, about 15 percent of Romney’s last two years of income went to charity — substantially higher than the percentage given by the Obamas or Joe Biden’s $380 (not a typo) of his quarter-million dollar income in 2006.
“Tax savings” allows people more money to save, spend, invest, bequeath and donate. On some level, even Democrats understand this.
Democrat Rep. Barney Frank, D-Mass., is one of them. In 2001, Massachusetts lowered it state income tax rate. But the legislature showed mercy for the Bay State’s guilt-ridden, tax-hike-supporting liberals. The tax form allowed the filer to check a special box — and pay the old, higher rate. Out of more than 3 million tax filers in 2004, a tiny fraction of 1 percent — 930 taxpayers — volunteered to pay the higher rate. Among those who declined the opportunity was Mr. Frank. Frank explained, “I don’t trust the legislative leadership and Gov. (Mitt) Romney to make the right decisions.” Instead, Frank said, “I’ll donate the money myself.” What?! Charity might better spend money than can government, which, by its nature, operates less efficiently and more expensively than can private welfare?
Democrat Sen. Howard Metzenbaum from Ohio (served 1974, 1976-1995) was another tax-supporting Democrat not too keen on paying more in taxes than he needed to. But after retirement, the wealthy Metzenbaum moved to Florida, which, unlike Ohio, is a state with no estate or personal income taxes. This saved him millions.
Democrat John Edwards’ wife Elizabeth, during the 2004 campaign, said rich politicians like her husband reveal “character” when they vote against financial “interest” by supporting higher taxes.
This is the same John Edwards who, as a trial lawyer winning big jury awards, established a separate sub-corporation to accept the money, paying him through dividends rather than income. Perfectly legal. But this allowed Edwards to avoid some $600K in Medicare payroll taxes.
Democrats like Sen. John Kerry, D-Mass., rail against the Bush tax cuts that rich people — like himself — “didn’t need” and “didn’t ask for.” Rhode Island requires no sales tax on yachts registered in that state — provided the boat is primarily housed in Rhode Island. Massachusetts is not so understanding. That state requires a sales tax and annual excise taxes. Folks say that Kerry and his 75-foot yacht spend way more time in Massachusetts than in Rhode Island. But accountants say that the wealthy yachtsman can avoid nearly $500K in state taxes by registering his boat in Rhode Island — which he did. All was going well, until a New York paper got hold of the story and Kerry “voluntarily” agreed to pay the Mass. tax — while continuing to insist that he does not really owe it.
Democrats like the late Ted Kennedy support the estate tax. And why not? The Kennedy family transfers wealth from generation to generation through trusts that avoid the very estate taxes that Kennedy consistently voted to impose on the wealth of others.
Shouldn’t tax-hike-supporting rich people like Warren Buffett want to pay more rather than less taxes? Yet one of Buffett’s companies is contesting tax claims against it.
Pro-tax-hike Democrats like MSNB-Hee-Haw’s the Rev. Al Sharpton deserve a special wing all to themselves in the Chutzpah Hall of Fame. Sharpton assails the Bush-era tax cuts and wants “the rich” to pay more. Sharpton lists income from his nonprofit at just under a quarter million dollars. Add this to his estimated salary at the cable network, and the “civil rights leader” likely pulls in a tidy $500K. Not bad for a guy that not long ago was a gold-medallion-wearing Harlem rabble-rouser in velour sweatpants who got famous by playing the race card in a phony rape case.
Sharpton, according to the New York Post, owes federal taxes and state taxes totaling $3.5 million. How much income would Sharpton have had to earn to amass $3.5 million in state and local taxes? A lot. How much nerve does it take for a guy making a half mil to go on television and pound the podium for higher taxes on the rich — when his own effective tax rate is 0 percent?
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