Why Does Romney Only Pay 15% Taxes?

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In summary, the conversation revolves around Mitt Romney's tax returns and the percentage of taxes he paid in 2010 and is expected to pay in 2011. The discussion also delves into the issue of tax deductions and the tax code, particularly in relation to capital gains and church contributions. Some individuals argue for a change in the tax code while others defend it. Overall, the conversation highlights the discrepancy in tax rates between the rich and the average citizen.
  • #71
russ_watters said:
...I suspect that category also includes most professional athletes, actors, experienced doctors and lawyers and very successful small business owners.
Yes that sounds right to me.
 
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  • #72
Whatever justifications might be given for Romney's tax payment(s), I have to agree with the polemicists who think that his disclosure will hurt his chances. But he had to do it. And now we know why he didn't want to.

So now Romney isn't just the sleazy political opportunist, or the adherent to a religious cult in the minds of some, he's also an extremely rich guy who pays a smaller percentage of his income in taxes than a huge number of Americans who are stuggling to make ends meet.
 
  • #73
ThomasT said:
So now Romney isn't just the sleazy political opportunist, or the adherent to a religious cult in the minds of some, he's also an extremely rich guy who pays a smaller percentage of his income in taxes than a huge number of Americans who are stuggling to make ends meet.
Er, didn't we just see a stat that showed Romney paid a higher rate than 80% of Americans?
 
  • #74
russ_watters said:
Er, didn't we just see a stat that showed Romney paid a higher rate than 80% of Americans?
I missed that. So, 80% of Americans pay less than 14% tax on their incomes?
 
  • #75
Yup, roughly: looking back, the stat was 80% paid less than 15% and Romney paid 14.5%. But that shouldn't be surprising since 47% pay 0% or less, right?
 
  • #76
russ_watters said:
But that shouldn't be surprising since 47% pay 0% or less, right?
And why do they pay no taxes? Below the poverty level?

Here's the answer, they're dirt poor.

31: Percent of nonpaying American households making $10,000 or less per year in 2010 (PDF link to study). An American household of any size making this amount of money, including just one person, is automatically under the poverty threshold.

61: Percent of nonpaying American households making $20,000 or less per year.

http://news.yahoo.com/numbers-47-percent-pay-no-income-tax-look-170500327.html [Broken]
 
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  • #77
I've got two jobs, but dad tells me that apparently I pay negative tax. Since I let him do my taxes, I trust him on that. Just sayin', not everyone who doesn't pay taxes is a worthless freeloader.
 
  • #78
Char. Limit said:
I've got two jobs, but dad tells me that apparently I pay negative tax. Since I let him do my taxes, I trust him on that. Just sayin', not everyone who doesn't pay taxes is a worthless freeloader.
It's not that legally paying no fed. income tax means anyone is worthless. It is simply the law, wrongly in my view. Everybody making enough to eat ought to pay something, half of 1% maybe, but something.
 
  • #79
Evo said:
And why do they pay no taxes? Below the poverty level?
Here's the answer, they're dirt poor.
http://news.yahoo.com/numbers-47-percent-pay-no-income-tax-look-170500327.html [Broken]
Yeah, I think it would be very difficult living, in America, on an income of, say, less than $25k, much less $10k per year.
 
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  • #80
mheslep said:
It's not that paying no fed. income tax means anyone is worthless. It is simply the law, wrongly in my view. Everybody making enough to eat ought to pay something, half of 1% maybe, but something.

Where I live (Washington State), there is a sales tax. So here, and in all places where there is a sales tax, they do pay something.

Not to mention gas tax, car registration tax, utility taxes, etc.
 
  • #81
lisab said:
Where I live (Washington State), there is a sales tax. So here, and in all places where there is a sales tax, they do pay something.

Not to mention gas tax, car registration tax, utility taxes, etc.

Hey, I live in the same place!

*acts like he just found this out*

But yeah, there's sales tax, and I'm sure other taxes as well. Gas tax I think is going up.
 
  • #82
lisab said:
Where I live (Washington State), there is a sales tax. So here, and in all places where there is a sales tax, they do pay something.

Not to mention gas tax, car registration tax, utility taxes, etc.
Everybody pays a local sales or local income tax somewhere, but I referred to federal taxes. Almost everybody should pay a little something to the federal govt. in my view, to encourage people to pay attention to federal elections if nothing else.
 
  • #83
ThomasT said:
Yeah, I think it would be very difficult living, in America, on an income of, say, less than $25k, much less $10k per year.
That's hard for a family with kids, not so much for a single person. I lived on less than $25k (today's dollars) for a couple years, though I had no school debt burden. Took a trip to Europe for about $1200 (today's $) including air. I worked hard, played hard, and I was not 'poor'.
 
  • #84
russ_watters said:
Yup, roughly: looking back, the stat was 80% paid less than 15% and Romney paid 14.5%.
But wasn't Romney's income around $20m?

Imho, the tax code needs to be seriously revised ... basically eliminating all loopholes and deductions. Then somebody with an income like Romney's pays a much higher percentage in taxes than the average salary or wage earner.

The point being that when you get into the millions of dollars of yearly income, it's likely that much of that income is not the result of any sort of productive or creative work that benefits the general economy, but rather due to ridiculously inflated incomes/bonuses and investments.

russ_watters said:
But that shouldn't be surprising since 47% pay 0% or less, right?
There are people who pay less than 0% tax?

Anyway, isn't anybody who's working, and on the grid, subject to social security and medicare/medicaid taxes -- so that nobody who's filing a tax return, even if they get a refund wrt federal income tax, is untaxed?
 
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  • #85
Anyway, to return to my point, I think that this disclosure will hurt Romney. It simply adds to the list of things that average Americans might be expected to not like about him, imo.
 
  • #86
85 posts in 2 days! Assuming that this topic stimulates similar attention in the general election I think Romney is not a good choice for the GOP; a big distraction from the real issues.

Skippy
 
  • #87
Evo said:
And why do they pay no taxes? Below the poverty level?

Here's the answer, they're dirt poor.

http://news.yahoo.com/numbers-47-percent-pay-no-income-tax-look-170500327.html [Broken]
That's "dirt poor" by a definition you pulled out of the air, Evo. The US poverty line does not cover 47% of Americans. The first block in the link (31% of the 47%) is roughly all the poor in the US, by the federally defined poverty level.

"Why" is an interesting question, though: why has the number of Americans paying 0% or less shot up dramatically in the last 30 years while the poverty rate has been relatively flat?
 
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  • #88
lisab said:
Where I live (Washington State), there is a sales tax. So here, and in all places where there is a sales tax, they do pay something.

Not to mention gas tax, car registration tax, utility taxes, etc.
Sure, but now we're comparing apples and oranges. This thread is about Romney and his 14.5% is only about his federal income tax. If you want to throw in other taxes so you can say the poor pay taxes, you have to also add those other taxes to Romney's percentage too.
 
  • #89
ThomasT said:
But wasn't Romney's income around $20m?
Yes. So what?
Imho, the tax code needs to be seriously revised ... basically eliminating all loopholes and deductions. Then somebody with an income like Romney's pays a much higher percentage in taxes than the average salary or wage earner.
Er, are you not listening or do you simply not believe the stats that you're seeing with your own eyes? He already does! 14.5% is much higher than 0%, isn't it?

Moreover, because people get down to 0% largely through deductions, your proposal (eliminating all loopholes and deductions) would almost certainly have exactly the opposite effect of what you are looking for.

And in addition, I think we should examine whether this "problem" is getting better or worse. I think most people would be surprised...but that's another thread.
There are people who pay less than 0% tax?
Yes. Please look at the stats that were provided for you. Again (thanks to mege):
http://www.cbo.gov/publications/collections/tax/2010/AverageFedTaxRates2007.pdf [Broken]

http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=456

(Similar data in both links, one in PDF and one in html)
Anyway, isn't anybody who's working, and on the grid, subject to social security and medicare/medicaid taxes -- so that nobody who's filing a tax return, even if they get a refund wrt federal income tax, is untaxed?
Yes, but again if we want to compare apples to apples, you need to stick with the federal income tax because that's what Romney's 14.5% is about.
 
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  • #90
@russ watters,

Yes, I looked at the publications, and have no reason to doubt their veracity. But my point was that Romney, who made about $20m, and paid 14.5% on that income is paying a smaller percentage than a lot of people who made between $50k and $100k. Eg., my best year, when I was working and paying taxes, was about $80k, and I'm pretty sure that I paid the federal government more than 14.5% of that.

Anyway, imo, the important point wrt this thread is that Romney's disclosure will hurt his chances of getting elected to the presidency ... simply because, imo, most Americans are going to want someone making $20m to pay more than 14.5% of that in federal income tax.

Wrt including the payments for SS and Medi, the fact of the matter is that they're payments made to the federal government by everybody who reports less than $106k, so, imo, it makes sense to include these in any comparative consideration of taxes paid to the federal government.
 
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  • #91
Why is the percentage of taxes the main focus? It looks like he paid almost three million dollars Federal taxes. If you look at the dollar amount instead of a percentage, he is paying 3 million more in federal taxes than the lower 47 percent of income earners combined. Of course this is a nonsense argument but so is fussing about Romney not paying more than is legal. If he broke laws, that is an issue. If the tax code is unfair, that is an issue. He you wish to vilify him just because he has been successful, that is nothing more than class warfare. Judge people not by the size of their bank account, but by the content of their character.
 
  • #92
azdavesoul said:
Why is the percentage of taxes the main focus? It looks like he paid almost three million dollars Federal taxes. If you look at the dollar amount instead of a percentage, he is paying 3 million more in federal taxes than the lower 47 percent of income earners combined. Of course this is a nonsense argument but so is fussing about Romney not paying more than is legal. If he broke laws, that is an issue. If the tax code is unfair, that is an issue. He you wish to vilify him just because he has been successful, that is nothing more than class warfare. Judge people not by the size of their bank account, but by the content of their character.
It's not, imo, a matter of class warfare. And certainly Romney isn't breaking the law. It's just, imo, a matter of what he and his ilk can afford. He paid 14.5% on his income of $20m. He should have paid about 30%, imho.

The very rich benefit from a convoluted and ridiculously compex tax code that allows them to pay much less than they can afford. So, I think that eliminating the loopholes that benefit the very rich would be a progressive and good step in the evolution of American society.

The very rich should, imo, be taxed at extremely high rates simply because they accumulate ridiculously large amounts of money via little or no work that actually benefits the general economy and the mass American populace.
 
  • #93
azdavesoul said:
Why is the percentage of taxes the main focus? It looks like he paid almost three million dollars Federal taxes. If you look at the dollar amount instead of a percentage, he is paying 3 million more in federal taxes than the lower 47 percent of income earners combined. Of course this is a nonsense argument but so is fussing about Romney not paying more than is legal. If he broke laws, that is an issue. If the tax code is unfair, that is an issue. He you wish to vilify him just because he has been successful, that is nothing more than class warfare. Judge people not by the size of their bank account, but by the content of their character.

Actually, the OP asks the question about tax code fairness:

JonDE said:
I'm not blaming him personally, so please don't take it that way. Most people are going to pay what they have to pay. What I blame is our tax code that allows for too many deductions.
In 2010 Romney paid 13.9% taxes. In 2011 he expects to pay 15.4%

http://www.rocketnews.com/2012/01/wealthy-romney-pays-13-9-tax/

He is just using Romney as an example.

If Romney (and others in his tax bracket) got so wealthy because of poorly-written tax code, why is it considered "class warfare" to discuss the tax code? Bringing in terms like "class warfare" just muddles the issue. Plus it sounds all Fox-Newsy.

IMO, our tax system is the issue, not those who know how to use it to their advantage.
 
  • #94
lisab said:
If Romney (and others in his tax bracket) got so wealthy because of poorly-written tax code, why is it considered "class warfare" to discuss the tax code? Bringing in terms like "class warfare" just muddles the issue. Plus it sounds all Fox-Newsy.

IMO, our tax system is the issue, not those who know how to use it to their advantage.
That is a fair assessment. It would be nice to have a simplified Federal tax system without all the deductions, exclusions, etc, that let people pay less than their fair share just because they have found some loop-holes to exploit.

I'd like to add that if you want to stash your loot in the Caymans, you should give up your citizenship and go live in the Caymans. It's very nice there. You won't miss us, and we won't miss you.
 
  • #95
turbo said:
It would be nice to have a simplified Federal tax system without all the deductions, exclusions, etc, that let people pay less than their fair share just because they have found some loop-holes to exploit.
I agree. And I think that most Americans would probably agree. The US tax system is by the rich and for the rich. Nothing wrong with that if you happen to be rich, but most Americans aren't rich.

Romney isn't likely to address changes in the tax code. But then neither is Obama. If Americans want positive change, then, imo, they need to stop voting for major party candidates.
 
  • #96
ThomasT said:
I agree. And I think that most Americans would probably agree. The US tax system is by the rich and for the rich. ...
...And paid by the rich.
 
  • #97
mheslep said:
...And paid by the rich.
Largely, yes. And that's as it should be. The point is that they can afford, and, imo, should be required, to pay more than they do.
 
  • #98
ThomasT said:
Largely, yes. And that's as it should be. The point is that they can afford, and, imo, should be required, to pay more than they do.
As Elizabeth Warren has pointed out, if you have made a fortune in business, good for you. BUT, your employees were educated by a public school system paid for by us. Your raw materials come in over a highway system paid for us, and you use that same system to ship your goods. Your electrical power, water, etc come to your plant thanks to taxpayers who established those utilities. If you deal in digital products, who paid for the Internet that you need to distribute them? There are no self-made men in this economy, IMO.

The sense of entitlement surrounding the wealthy is palpable, and unwarranted. I grew up in a little town that was next to a slightly larger one. Before I was born, a birch-veneer mill was built in that town. The owners (brothers) and their GM had sports cars, big yachts, and other bling. BUT they paid for a brand-new elementary school to be built in town, paid for a general-assistance program to help poor people, and IIR, paid for the property and lots of the construction costs for the new junior-high/HS that opened a couple of years before I got out of elementary school. They were rich, but they had some sense of responsibility to the community. I don't see that as much, these days.
 
  • #99
ThomasT said:
I agree. And I think that most Americans would probably agree. The US tax system is by the rich and for the rich. Nothing wrong with that if you happen to be rich, but most Americans aren't rich.
Implying the deductions benefit the rich most? Again, again, again: that isn't true.
Yes, I looked at the publications, and have no reason to doubt their veracity. But my point was that Romney, who made about $20m, and paid 14.5% on that income is paying a smaller percentage than a lot of people who made between $50k and $100k.
Well that characterization is true, but $50-$100k is nowhere close to "average". But props for getting to an accurate characterization.
Eg., my best year, when I was working and paying taxes, was about $80k, and I'm pretty sure that I paid the federal government more than 14.5% of that.
There's a good chance, yes - based on the data, it looks like almost everyone from about 60% to 99%+ pays higher than 14.5%. The capital gains loophole that let's Romney pay that low rate only affects a very small fraction of the population, at the very top.
 
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  • #100
russ_watters said:
Implying the deductions benefit the rich most? Again, again, again: that isn't true.

I'm not sure how you implied that from what Thomas said. There are many ways the rich benefit from the present tax code, e.g., paying much lower taxes on capital gains.
 
  • #101
lisab said:
I'm not sure how you implied that from what Thomas said. There are many ways the rich benefit from the present tax code, e.g., paying much lower taxes on capital gains.
Capital gains rates is one of just two ways being discussed in this thread that enables the very rich to pay a lower federal income tax rate than everyone else [edit:Jeez, look at that - I said it now too! That should be a lower federal income tax rate than others with high incomes]. The second is large charitable deductions. Another way that is factually wrong, that Thomas said yesterday and turbo referenced in the post Thomas was responding to (so not implied: actually claimed), is the assumption that deductions predominantly benefit the rich.

I'd like to see other of the "many" ways, though.
...why is it considered "class warfare" to discuss the tax code? Bringing in terms like "class warfare" just muddles the issue.
It isn't class warfare to discuss flaws in the tax code, but it is class warfare to attack Romney or the rich simply for being rich or to use the issue for political attacks.
Plus it sounds all Fox-Newsy.
If you've got a better term, by all means share, but considering that warfare terminology is used by many who do it ("Occupy"), it seems an appropriate term to me.

[edit] Citation for the claim about deductions predominantly benefiting the rich/poor is Evo's link about who the 47% who pay no or negative income taxes are:
About 46 percent of American households will pay no federal individual income tax in 2011,
roughly half of them because of structural features of the income tax that provide basic
exemptions for subsistence level income and for dependents. The other half are nontaxable
because tax expenditures— special provisions of the tax code that benefit selected taxpayers or
activities—wipe out tax liabilities and, in the case of refundable credits, result in net payments
from the government. Most important of those tax expenditures are provisions that benefit senior
citizens and low-income working families with children. While those factors particularly affect
lower-income households, different provisions eliminate taxes for other households. Itemized
deductions and credits for children and education are more important for middle-income
households, while the relatively few high-income nontaxable households benefit most from
above-the-line and itemized deductions and reduced tax rates on capital gains and dividends.
In other words, for those who pay no income tax, about half of what causes them to pay no income tax is deductions and about half is due to the progressive nature of the tax structure. And virtually all of these people are lower income people. So while Romney is in a small group of super-rich who manage to get their effective tax rate cut in half, about a quarter of the population, almost all at the bottom, get their tax rate cut by 100% or more.

Personally, it looks to me like the quote is misworded in that there probably aren't two halves of the 47%, but rather two reasons that are half of the effect, shared in different proportions by different people (ie, a poor person both benefits from the progressive tax structure and gets tax credits). But either way, it proves the point.
 
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  • #102
russ_watters said:
... in the post Thomas was responding to (so not implied: actually claimed), is the assumption that deductions predominantly benefit the rich.
Ok, for now I'll concede that point. It's certainly true that many people, not just the very rich, benefit from deductions.

russ_watters said:
It isn't class warfare to discuss flaws in the tax code, but it is class warfare to attack Romney or the rich simply for being rich or to use the issue for political attacks.
I agree, and am not attacking Romney for being rich. His wealth, and what it took to attain and keep that wealth is a very positive thing, imo, and a point in his favor. My point wrt this thread is that Romney, and other very rich people, can afford to pay more taxes than he (they) actually pay(s), and, imho, the US tax code should require this.
 
  • #103
turbo;3730529]As Elizabeth Warren has pointed out, if you have made a fortune in business, good for you. BUT, your employees were educated by a public school system paid for by us. Your raw materials come in over a highway system paid for us, and you use that same system to ship your goods. Your electrical power, water, etc come to your plant thanks to taxpayers who established those utilities. If you deal in digital products, who paid for the Internet that you need to distribute them? There are no self-made men in this economy, IMO.

Public schools are usually paid for out of property taxes, do the rich pay more in property taxes? From what I have seen, the rich usually have 2+ properties and more times than not they send their children to private schools. Imo, they have paid for the children(future employees) to get their high school diploma. The highway funding comes largely from fuel taxes, who pays more for highways, the people driving one car that gets decent mileage, or a fleet of semi's moving products across this nation at bout 4 miles to the gallon? I have a hard time seeing how the rich haven't been paying their "fair share", or that the people have any right to their wealth.

The sense of entitlement surrounding the wealthy is palpable, and unwarranted. I grew up in a little town that was next to a slightly larger one. Before I was born, a birch-veneer mill was built in that town. The owners (brothers) and their GM had sports cars, big yachts, and other bling. BUT they paid for a brand-new elementary school to be built in town, paid for a general-assistance program to help poor people, and IIR, paid for the property and lots of the construction costs for the new junior-high/HS that opened a couple of years before I got out of elementary school. They were rich, but they had some sense of responsibility to the community. I don't see that as much, these days.

So Iyo, you feel that the producers are the ones who feel they are entitled to others money, at the same time you argue that the masses deserve more of their wealth. Imo, it is the masses(and politicians) who have a sense of entitlement, not the rich. I find it interesting how you start your story, of the not as evil rich, by saying they own all these fancy things, but they still did things for the community which redeemed them in your eyes. One question, who builds those fancy cars, fancy houses, and all the other bling? Isnt it employees, of other rich people, who are employed solely because someone is buying their product? If no one buys those products who looses, the rich, or the workers? There are tons of products that if it wasnt for rich, those products would disapear. The rich would still be rich, the workers would be unemployed though. Imo, any regulation put in place will never affect the rich, they have the resources to get around them, the ones who get hurt are those who cant, the masses, and it is because of the regulations that all the loopholes the "evil rich" use, exist.

= lisab: I'm not sure how you implied that from what Thomas said. There are many ways the rich benefit from the present tax code, e.g., paying much lower taxes on capital gains.

And the rest of us don't get that same rate? Lisa, please remember that capital gains have already been taxed at around 35% as corporate income, before it gets taxed again. Imo, capital gains and profits are all that should be taxed, but aslong as our income is getting taxed, I have a hard time getting behind a plan to then tax those gains and profits again. Either our income should be tax free, or our profits should be tax free, I vote for income. It seems to me that one of the big things we hear now-a-days is how those evil rich people are making too much profit, well I say tax the profit and that would get companies to reduce profit, instead of the system we have now where everyone tries to lower their income either by deductions and contribributions. Who has the resources to hire a team of accountants to lower their effective tax rate, the rich, or the rest of us?

Romney paid his legally required taxes, it funny when he gets lamblasted, by people like Al Sharpton who owe millions in back taxes, or by an administration which has tax cheat timothy geitner, or by other 1%'ers like buffet and pelosi, who have used the exact smae tools to lower their tax rates.
 
  • #104
ThomasT said:
I agree, and am not attacking Romney for being rich. His wealth, and what it took to attain and keep that wealth is a very positive thing, imo, and a point in his favor.
Understood - and while it isn't your position, you acknowledged the reality that the "class warfare" issue is/will be a big one for Romney in the election. We're on the same page on that.
My point wrt this thread is that Romney, and other very rich people, can afford to pay more taxes than he (they) actually pay(s), and, imho, the US tax code should require this.
On that we are agreed as well.
 
  • #105
mege said:
For perspective - here's the effective tax rates for a few years - http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=456 (this is CBO data, just easier to read IMO)

So for every 1 Romney that is paying 15% taxes... there are 5 others in the same income paying at least 35% taxes. The justification for the 'Buffett rule' doesn't align with the 'Buffett facts' IMO.

I love the irony of the "Buffett rule". I'm a firm believer in the old saying ":...the truth will set you free..."
http://www.forbes.com/sites/paulrod...y-likely-makes-between-200000-and-500000year/

"Warren Buffett's Secretary Likely Makes Between $200,000 And $500,000/Year

Comment now Warren Buffett’s secretary, Debbie Bosanek, served as a stage prop for President Obama’s State of the Union speech. She was the president’s chief display of the alleged unfairness of our tax system – a little person paying a higher tax rate than her billionaire boss."
 
<h2>1. Why does Romney only pay 15% taxes?</h2><p>There are a few reasons for this. One is that Romney's income comes primarily from investments, which are taxed at a lower rate than traditional income. Another reason is that he may have utilized tax deductions and loopholes to lower his taxable income. Additionally, the tax code allows for certain tax breaks for high-income earners like Romney.</p><h2>2. Is it legal for Romney to only pay 15% taxes?</h2><p>Yes, it is legal for Romney to pay 15% taxes. The tax code allows for different tax rates for different types of income and also allows for deductions and loopholes that can lower taxable income. As long as Romney is following the tax laws and regulations, his tax rate is considered legal.</p><h2>3. How does Romney's tax rate compare to the average American?</h2><p>Romney's tax rate is significantly lower than the average American's tax rate, which is around 25%. This is due to the fact that the majority of Romney's income comes from investments, which are taxed at a lower rate than traditional income. Additionally, the tax code allows for certain tax breaks for high-income earners like Romney.</p><h2>4. Can the government do anything to change Romney's tax rate?</h2><p>The government can potentially change the tax code to eliminate or reduce tax breaks and loopholes that benefit high-income earners like Romney. However, this would require legislative action and would likely face opposition from those who benefit from these tax breaks.</p><h2>5. How does Romney's tax rate affect the economy?</h2><p>Some argue that Romney's low tax rate allows him to reinvest more money into the economy, which can stimulate economic growth. Others argue that his low tax rate contributes to income inequality and does not benefit the economy as a whole. The effects of Romney's tax rate on the economy are a subject of debate and vary depending on one's perspective.</p>

1. Why does Romney only pay 15% taxes?

There are a few reasons for this. One is that Romney's income comes primarily from investments, which are taxed at a lower rate than traditional income. Another reason is that he may have utilized tax deductions and loopholes to lower his taxable income. Additionally, the tax code allows for certain tax breaks for high-income earners like Romney.

2. Is it legal for Romney to only pay 15% taxes?

Yes, it is legal for Romney to pay 15% taxes. The tax code allows for different tax rates for different types of income and also allows for deductions and loopholes that can lower taxable income. As long as Romney is following the tax laws and regulations, his tax rate is considered legal.

3. How does Romney's tax rate compare to the average American?

Romney's tax rate is significantly lower than the average American's tax rate, which is around 25%. This is due to the fact that the majority of Romney's income comes from investments, which are taxed at a lower rate than traditional income. Additionally, the tax code allows for certain tax breaks for high-income earners like Romney.

4. Can the government do anything to change Romney's tax rate?

The government can potentially change the tax code to eliminate or reduce tax breaks and loopholes that benefit high-income earners like Romney. However, this would require legislative action and would likely face opposition from those who benefit from these tax breaks.

5. How does Romney's tax rate affect the economy?

Some argue that Romney's low tax rate allows him to reinvest more money into the economy, which can stimulate economic growth. Others argue that his low tax rate contributes to income inequality and does not benefit the economy as a whole. The effects of Romney's tax rate on the economy are a subject of debate and vary depending on one's perspective.

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