Romney will not reveal tax data, at least for now
Also refuses to say if he gains from loopholes
LANCASTER, N.H. - Mitt Romney said yesterday he has no current plans to release his tax returns, and suggested that he would not shrink from using a controversial provision of the tax code that allows him to pay at just a 15 percent rate on income he continues to receive from Bain Capital.
“We don’t have any current plans to release tax returns, but never say never,’’ he said yesterday after greeting voters at an Agway farm and hardware store here. “We’ll see what the future holds. We’ve released, of course, all of the information required by law, which is a pretty extensive release. But down the road we’ll see what happens if I’m the nominee.’’
Romney also indicated that he would not shy away from a legal tax break that shelters partners at private equity firms, like Bain Capital, from high tax rates on the largest part of their take-home profits.
“I can tell you we follow the tax laws, and if there’s an opportunity to save taxes, we like anybody else in this country will follow that opportunity,’’ he said.
Partners at firms such as Bain, which buy companies, as well as at hedge funds, qualify for a 15 percent tax rate on “carried interest,’’ or the profits they make on investment deals. This type of pay - which often adds up to millions of dollars annually for these executives - is taxed like capital gains, rather than as regular income, which is subject to a 35 percent tax for the wealthiest taxpayers.
The Obama administration has proposed closing the carried-interest loophole, while the industry has argued that the move would hurt the economy - that investment executives need these incentives to put their own capital at risk. In the case of Romney, his retirement agreement with Bain had him receiving payouts for at least a decade after he left the firm in 1999. A spokesman for Bain Capital declined to comment.
Advocates of using the tax code to reduce income inequality are especially critical of the “carried interest’’ tax break. “It’s probably the biggest loophole in the tax code for super-rich people,’’ said Jacob S. Hacker, a professor of political science at Yale University and co-author of “Winner-Take-All Politics.’’
“The idea that private equity managers and hedge fund managers should pay 15 percent, when in fact they’re just getting a cut from the pool of capital under management - it’s completely egregious,’’ Hacker said.
“There’s very little risk that’s being borne by these people,’’ Hacker said. “It’s a big subsidy for a certain kind of financial management.’’
Among the Republican presidential candidates, only Texas Governor Rick Perry has released his tax returns, reporting nearly $217,500 in adjusted gross income in 2010. In October, Perry urged Romney, the richest candidate in the race, to do the same.
Spokesmen for Ron Paul and Jon Huntsman noted that their candidates follow federal financial disclosure laws but gave no indication as to whether they would voluntarily release their tax returns. A spokesman for Newt Gingrich said the former House speaker would release his tax returns but only if he wins the nomination.
Rick Santorum and Michele Bachmann did not respond to requests for comment.
President Obama released six years of his tax returns March 25, 2008, trying to pressure his then-Democratic rival Hillary Clinton to do the same. Obama has since released his tax returns annually, and his campaign has sought to make an issue out of Romney not releasing his tax returns, or the donors who bundle financial contributions for his campaign.
Romney has never released his tax returns - when running for US Senate in 1994, for governor of Massachusetts in 2002, or during his last presidential bid in 2008. During his 1994 race against Senator Edward M. Kennedy, he called on him to release his state and federal taxes to prove he had “nothing to hide.’’
“It’s time the biggest-taxing senator in Washington shows the people of Massachusetts how much he pays in taxes,’’ Romney said at the time. He said he would disclose his on the same day as Kennedy, but Kennedy never did.
The Democratic National Committee yesterday criticized Romney for not releasing his tax returns, calling him “a corporate buyout specialist’’ who has “made millions of dollars in income from investments, which are taxed at a far lower rate than the wages of regular Americans.’’ The DNC also set up a website, whatmittpays.com, that has a tool to find out how much more in taxes taxpayers pay on their current income, compared with what they would pay if they were paying 15 percent.
Democrats have also criticized Romney for a decision his staff made at the end of his term as governor. The Globe reported last month that 11 of his aides purchased 17 hard drives, a practice that was legal but unprecedented, according to state officials.
The day after the Globe report, Romney’s campaign issued a memo to reporters. The title was “Obsessed with Secrecy,’’ and accused the Obama administration of having “turned its back on his campaign promises of openness and transparency.’’