Appearing on 60 Minutes Sunday night after a rocky week on the campaign trail, Republican presidential candidate Mitt Romney defended paying a relatively low effective rate on his federal income taxes, arguing that it is fair for people to pay lower rates on capital gains.
Although the interview was filmed before the Romney campaign released the candidate’s 2011 tax returns on Friday, the first questions focused on Romney’s tax plans, and on his own individual income tax rate. Romney, who makes most of his income from capital gains, paid an effective tax rate of just 14.1 per cent last year.
“It is a low rate,” Romney told CBS’ News Scott Pelley. “One of the reasons why the capital gains tax rate is lower is because capital has already been taxed once at the corporate level, as high as 35%.”
Pressed on whether it is fair that he pays a lower effective rate than people who earn much less than he does, Romney replied affirmatively.
“I think it’s the right way to encourage economic growth — to get people to invest, to start businesses, to put people to work,” he added.
Romney went on to reiterate that, under his tax plan, income tax rates would be cut by 20 per cent across the board, and families earning less than $200,000 a year would no longer be taxed on interest, dividends, and capital gains. The loss in revenue, he said, would be offset by eliminations in loopholes and deductions in the tax code, especially for those making over $200,000. But he would not divulge what specific deductions would be eliminated.
“That’s something Congress and I will have to work out together,” he said, adding later: “The devil’s in the details. The angel is in the policy, which is creating more jobs.”
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