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US Republican hopeful Mitt Romney 'pays 13.9% tax' | US Republican hopeful Mitt Romney 'pays 13.9% tax' |
(40 minutes later) | |
US Republican presidential candidate Mitt Romney has said he expects to pay about $6.2m (£4m) in taxes on income of $42.5m in the last two years. | US Republican presidential candidate Mitt Romney has said he expects to pay about $6.2m (£4m) in taxes on income of $42.5m in the last two years. |
That makes for a tax rate of 13.9% in 2010 and an expected rate of 15.4% in 2011, his campaign said. | That makes for a tax rate of 13.9% in 2010 and an expected rate of 15.4% in 2011, his campaign said. |
His income places him among the top earners in the US and his taxes have become a campaign issue. | His income places him among the top earners in the US and his taxes have become a campaign issue. |
Mr Romney was an early favourite in state primaries but lost the latest, in South Carolina, to rival Newt Gingrich. | Mr Romney was an early favourite in state primaries but lost the latest, in South Carolina, to rival Newt Gingrich. |
Mr Gingrich released his tax figures on Saturday, saying he paid nearly $1m last year, a rate of about 31%. | Mr Gingrich released his tax figures on Saturday, saying he paid nearly $1m last year, a rate of about 31%. |
'Not a dollar more' | 'Not a dollar more' |
Mr Romney is a multi-millionaire businessman and former Massachusetts governor with three homes and lives mainly on income from his investments, for which only 15% tax is payable. Earned income is taxed at up to 35%. | Mr Romney is a multi-millionaire businessman and former Massachusetts governor with three homes and lives mainly on income from his investments, for which only 15% tax is payable. Earned income is taxed at up to 35%. |
On Monday, before he released his income and tax figures, he defended his tax record. | On Monday, before he released his income and tax figures, he defended his tax record. |
"I pay all the taxes that are legally required and not a dollar more. I don't think you want someone as the candidate for president who pays more taxes than he owes.'' | "I pay all the taxes that are legally required and not a dollar more. I don't think you want someone as the candidate for president who pays more taxes than he owes.'' |
On Tuesday, Mr Romney released his 2010 tax papers and estimates for his 2011 taxes, for which he has not yet filed a return. | On Tuesday, Mr Romney released his 2010 tax papers and estimates for his 2011 taxes, for which he has not yet filed a return. |
He and his wife Ann reported income of $21.6m in 2010 and $20.9m last year, almost all it from investments. | He and his wife Ann reported income of $21.6m in 2010 and $20.9m last year, almost all it from investments. |
They gave $7m to charity in the same period, about half of it to the Mormon Church. | They gave $7m to charity in the same period, about half of it to the Mormon Church. |
President Barack Obama and his wife Michelle released their tax 2010 tax return in April last year, showing an income of $1.7m. They paid about $450,000 in federal tax, a rate of about 26%. | President Barack Obama and his wife Michelle released their tax 2010 tax return in April last year, showing an income of $1.7m. They paid about $450,000 in federal tax, a rate of about 26%. |
Tax debate | |
Mr Romney had promised to release the figures, saying the question of tax had become a distraction for his campaign, and he wanted to re-focus on the main issues. | Mr Romney had promised to release the figures, saying the question of tax had become a distraction for his campaign, and he wanted to re-focus on the main issues. |
He had initially refused to release the returns, saying the financial disclosure reports that all federal candidates must provide should be enough. | He had initially refused to release the returns, saying the financial disclosure reports that all federal candidates must provide should be enough. |
But the reluctance allowed his Republican rivals and Democratic critics to focus on his record at private equity firm Bain capital, painting him as a wealthy businessman who cut jobs and shut down firms. | But the reluctance allowed his Republican rivals and Democratic critics to focus on his record at private equity firm Bain capital, painting him as a wealthy businessman who cut jobs and shut down firms. |
Mr Romney's supporters have leapt to his defence, equating attacks on his business practices with criticism of American capitalism itself. | Mr Romney's supporters have leapt to his defence, equating attacks on his business practices with criticism of American capitalism itself. |
But the issue has reignited the debate in the US over how investment income - in particular carried interest, the profits that private equity managers make - is taxed. | |
President Obama has said such income should be taxed at a higher rate, and that wealthy Americans and corporations should pay more tax to help trim the country's deficit. | |
Republicans are opposed to any tax hikes, saying they would harm the economy. | |
Gingrich surge | |
Mr Romney had led the Republican field since November and appeared to have won the first two contests of the campaign, in Iowa and New Hampshire. | Mr Romney had led the Republican field since November and appeared to have won the first two contests of the campaign, in Iowa and New Hampshire. |
But the Iowa caucus result was overturned in a recount which gave a narrow victory to Rick Santorum. | But the Iowa caucus result was overturned in a recount which gave a narrow victory to Rick Santorum. |
Mr Gingrich, who polled poorly in both Iowa and New Hampshire, won a convincing victory over Mr Romney in South Carolina after attacking Mr Romney over his business and tax records. | Mr Gingrich, who polled poorly in both Iowa and New Hampshire, won a convincing victory over Mr Romney in South Carolina after attacking Mr Romney over his business and tax records. |
The candidates now head to Florida, which holds its primary on 31 January. The state is seen as a major battleground state in the US general election, with a diverse electorate and where a lot of money will be spent campaigning. | The candidates now head to Florida, which holds its primary on 31 January. The state is seen as a major battleground state in the US general election, with a diverse electorate and where a lot of money will be spent campaigning. |
Primaries and caucuses will be held in every US state over the next few months to pick a Republican nominee before the eventual winner is anointed at the party convention in August to take on Democratic President Barack Obama in November. | Primaries and caucuses will be held in every US state over the next few months to pick a Republican nominee before the eventual winner is anointed at the party convention in August to take on Democratic President Barack Obama in November. |