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Embarrassment of riches as Romney unveils tax returns

Republican Mitt Romney on Tuesday revealed he makes a staggering $20 million a year and pays a lower tax rate than most struggling Americans, in the latest twist in the roiling 2012 White House race.

world Updated: Jan 24, 2012 23:02 IST

Republican Mitt Romney on Tuesday revealed he makes a staggering $20 million a year and pays a lower tax rate than most struggling Americans, in the latest twist in the roiling 2012 White House race.

The figures will likely shock a polarised American public fixated on themes of "class warfare" and the growing income disparity between rich and poor -- which has led in recent months to the Occupy protests in US cities.

Under pressure the former Massachusetts governor, battling his main rival Newt Gingrich to be the Republican party's nominee for the November elections, released his tax records online.

They showed the ultra-rich businessman reported income of $21.7 million in 2010 from investments and an estimated $20.9 million in 2011 -- and paid in 2010 just over $3 million in taxes, a paltry rate of just 13.9%, much lower rate than most Americans.

Salaried workers in the United States can fork over as much as 35% of their earnings in federal taxes.

Romney finally agreed to disclose his income after Democratic critics and Republican opponents clamored for an accounting of the vast wealth he has accrued as a venture capitalist ahead of Florida's key primary on January 31.

The on-again, off-again frontrunner in the Republican race to take on Democratic President Barack Obama in November is accused of pillaging companies and destroying jobs during his 15-year career at equity firm Bain Capital.

But Romney repeated late Monday in a Republican debate that he would "not apologise for being successful."

Critics said Romney's high income and relatively low tax payments also underscore the difficulty he appears to have relating to everyday working-class people, as he struggles to pin down the party's nomination.

A new poll released on Tuesday by Public Policy Polling put Gingrich five percentage points ahead of Romney in the vote-rich battleground Sunshine State with 38 percent to 33% -- reversing a two-digit lead Romney held here just last week.

The world's largest economy is still struggling to recover from the worst recession in decades, which has seen the unemployment rate leap to around 8.5%, and is mulling how to repair a lopsided revenue system that some say unfairly favors the wealthy.

Tuesday's documents showed that Romney -- one of the richest people to ever seek the presidency -- paid some six million dollars in the past two years on more than $40 million of income.

Obama was to highlight inequalities in the US tax system on Tuesday, by welcoming the secretary of billionaire financier Warren Buffett to his State of the Union address. Buffett has consistently argued that it is unfair that he pays a lower tax rate than his secretary.

Davie Plouffe, a top Obama aide, said the embarrassment of Romney riches -- and relatively low taxes paid on them -- illustrate why it is high time, in the president's view, to overhaul the US tax code.

"It's a good example of the tax reform we need," he said.

"We want to reward wealth, prosperity and success. But if we are to move forward as a country, reduce deficit, invest in manufacturing education, how are we going to pay for it?" Plouffe told NBC television.

Former House speaker Gingrich meanwhile was hoping that the reported pledge by the wife of a Casino mogul to inject $5 million into a pro-Gingrich campaign group will boost his war chest as he seeks a win in the Florida primary.

Gingrich handed Romney a shock defeat in Saturday's South Carolina Republican presidential primary, beating him by more than 12 percentage points and boosting his campaign hopes once written off as dead.

But the former Georgia lawmaker has also been under fire for earning $1.6 million as a consultant to the Freddie Mac mortgage giant during the housing meltdown which precipitated the US recession.

Romney was once seen as invincible in his second-time-lucky bid to be the party's presidential standard-bearer. But Republicans are leery of his moderate policies as governor of left-leaning Massachusetts, his changing positions on key issues such as abortion and gay marriage, and his Mormon faith deemed by some to be one step away from a cult.

First Published: Jan 24, 2012 23:01 IST