It looks like with less than 50 days until election day (and with some states already starting early voting), Willard Mitt Romney (aka Wall Street Willie) is finally ready to release his 2011 tax return -- although he is still refusing to release any returns before 2010. According to his campaign, Willard and his wife had $13,696,951 in income for 2011. On that income, they paid $1,935,708 in taxes for an effective tax rate of 14.13% -- again paying a smaller tax rate than many middle class taxpayers.
Willard could have paid an even smaller tax rate. He gave $4,020,772 to "charity" (which is probably money given to the mormon church, and not a real charity). If he had claimed a deduction for that full amount, he would have only had to pay an effective tax rate of 9%. But there's an election coming up and he's running for president, so he thought it would look better if he paid more (especially since he told the voters he never pays less than 13%). But don't feel too bad for Willard, since he can (and probably will) take the rest of the "charity" deduction in a future year.
And while Willard showed disdain for the 47% of Americans who don't earn enough money to pay income taxes, it should be noted that nearly all of those 47% pay more in payroll taxes (FICA taxes) than Willard does. Even those making minimum wage must pay 4.2% of their salary in payroll taxes to pay for Social Security and Medicare. But Willard, since he didn't actually work for any of his $13 million income doesn't have to pay those taxes at all. His income was investment income, which is exempt from FICA taxes.
And then we have state and local taxes. According to the Institute for Taxation and Economic Policy (ITEP), the taxes at the state and local level get much more regressive -- giving Willard and his compadres in the top 1% a much, much lighter tax load than people in the middle-income or low-income groups. And this is true in ALL 50 STATES. Here's some of what the ITEP said:
The fact is that nearly every state and local tax system takes a much greater share of income from middle- and low-income families than from the wealthy. This “tax the poor” strategy is problematic because hiking taxes on low-income families pushes them further into poverty and increases the likelihood that they will need to rely on safety net programs. From a state budgeting perspective, this “soak the poor” strategy also doesn’t yield much revenue compared to modest taxes on the rich. It’s no wonder that so many states with regressive tax structures are facing long-term structural budget deficits. They‘re continually imposing higher taxes on people without much money.
But while all 50 states are guilty of taxing low-income people at a much higher rate than the top 1%, some states are worse than others. Here are some of the worst offenders (comparing the percentage the top 1% pays to the percentage the bottom 20% pays):
Top 1% pays a 2.6% rate
Bottom 20% pays a 17% rate
Top 1% pays a 2.1% rate
Bottom 20% pays a 13.5% rate
Top 1% pays a 4.1% rate
Bottom 20% pays a 13% rate
Top 1% pays a 3% rate
Bottom 20% pays a 12.2% rate
Top 1% pays a 1.9% rate
Bottom 20% pays a 11% rate
Top 1% pays a 1.6% rate
Bottom 20% pays a 8.9% rate
Willard probably thought he had scored some political points by heaping derision of those who don't make enough in income to pay the federal income tax rate (and he probably did to the brain-dead teabaggers). But the truth is that it is shameful for this nation that such a large part of its population makes so little. And when all taxes are considered (income taxes, payroll taxes, state taxes, local taxes), it turns out that those low-income people actually pay a larger percentage of their meager incomes in taxes that does Willard and his rich friends.
That makes Willard's derogatory statement about "the 47%" look even more mean-spirited. Do we really want this lying fool to be our president?