MSM/Obama campaign/DNC narrative fail.
Via Fox News:
President Obama’s campaign, with a good dose of help from the media, is pushing a claim that millionaire Mitt Romney is taxed at a “lower rate” than someone making $50,000 a year.
The claim, though, is open to debate. It only holds up in a particular scenario in which both income and all payroll taxes are counted.
The president’s campaign presumably is referring to Romney’s release last week of his 2011 tax returns, which showed he paid an effective tax rate of 14.1 percent.
This revelation, as might be expected, fueled a wave of campaign stump speeches and videos. The latest was an Obama Web video blasting Romney’s “strange take on tax fairness.” It included clips of people accusing Romney of paying a lower rate than “average” Americans. An accompanying campaign email said: “Mitt Romney admitted he thinks it’s fair that his $20 million income was taxed at a lower rate than someone making $50,000.”
IRS data, though, shows that Romney’s effective income tax rate — that’s what he pays as a percentage of his income once deductions and other benefits are factored in — is actually far higher than what most Americans pay.
And it’s certainly higher than what someone making $50,000 pays.
IRS data from 2010 shows someone making between $50,000 and $75,000 on average pays an effective rate of 7.8 percent. Even someone making between $100,000 and $200,000 pays a 12.1 percent rate — also lower than Romney’s.
So what is the Obama campaign referring to? There are a couple possibilities.
The campaign likely is trying to make the point that Romney’s income — at least the huge chunk of it that is derived from investments — is taxed at a 15 percent rate, while others who earn their money from a paycheck are taxed at marginal income rates going all the way up to 35 percent.
The latter percentage, though, comes down once deductions and exemptions are included. The Tax Foundation estimated in a report in January that Romney’s rate in 2010 — which was also about 14 percent — was higher than what 97 percent of Americans pay.