The sweeping fiscal plan proposed by U.S. Rep. Paul Ryan in 2010 would have
driven GOP presidential candidate Mitt Romney's effective tax rate down to 1 percent
or 2 percent on the $21.6 million income Romney and his wife, Ann, reported that
year.
The evidence for that comes from the Romneys' tax return and a Tax Policy
Center analysis done for the Journal Sentinel in the wake of national media
reports on the issue after Romney named Ryan his running mate.
But Romney -- not Ryan -- is atop the ticket, and the former
Massachusetts governor has a tax reform plan that stops short of Ryan's
"Roadmap for America's Future."
And Ryan himself did not include his 2010 tax proposals in House budgets
he drew up in 2011 and 2012.
Ryan's 2010 "Roadmap" called for elimination of taxes on investment
earnings such as capital gains, dividends and interest, as well as the estate
tax, to spur more investment and eliminate what Ryan called the double
taxation of savings.
Romney, by contrast, would wipe out those investment-earnings taxes only
for Americans with an adjusted gross income of less than $200,000, his website
says.
Wealthier Americans, such as Romney, wouldn't get the break.
Stories focus on tax plan
Weekend stories by Roll Call and The Atlantic on how Romney might have
fared under Ryan's plan illustrate the political risks inherent in Romney's
choice of Ryan, who has authored unusually detailed budget blueprints on
spending cuts and tax changes he says will help the United States avoid a debt
crisis.
The Romney camp sought to minimize those risks over the weekend.
On day one of the rollout of the Romney-Ryan ticket, various newspaper
websites headlined an Associated Press story with variations of "Romney wary
of Ryan's budget."
Those headlines came after Romney and his top aides sought to make clear
that Romney has his own budget plan "and that's the budget plan we're going to
run on," The Associated Press reported.
Romney's comments followed volleys by President Barack Obama and
Democrats across the country claiming that Romney and Ryan were taking the
side of millionaires, not the middle class.
Democrats correctly pointed out that Romney clearly endorsed Ryan's
budget plan this year during the bitter GOP primaries, and Romney so far has
shown no indication he was flip-flopping on that.
There's an important footnote here, though.
The Romney and Ryan camps correctly point out that Ryan's tax-elimination
proposals were not part of that budget plan that Romney praised. That plan for
2013 passed the GOP-controlled House but not the Senate.
Romney, Ryan's campaign said Monday, would pay the same tax rates under
the Ryan 2013 budget plan as under current law.
Ryan's tax proposal was in his earlier "Roadmap" plan that went nowhere
in 2010.
Ryan, though, still promotes his "Roadmap" ideas, making them fair game
in the election.
Source of income key
Roll Call's analysis said Romney in 2010 would have paid "about 1%" in
taxes under Ryan's 2010 "Roadmap"; The Atlantic said 0.82%. Those relate to
Romney's 2010 return, the only final return he's released. That return showed
Romney's effective tax rate was 13.9%.
The Journal Sentinel consulted with the Tax Policy Center, a project of
the Urban Institute and Brookings Institution, which put the figure at 1% to
2%, depending on certain assumptions about Romney's income.
The reason for the low tax rate: most of Romney's income was not from
wages but from capital gains, dividends and interest -- which Ryan's roadmap
would exempt from taxation, said Roberton Williams, a senior fellow at the Tax
Policy Center.
Romney himself provided backing for these numbers during a GOP primary
debate in Florida in January when Newt Gingrich proposed no taxation on
capital gains tax.
Romney responded: "Well, under that plan I'd have paid no taxes in the
last two years."
A Romney campaign spokesman, Kevin Madden, on Monday called speculation
about Ryan's earlier plan "irrelevant" to Romney's plans. Aides pointed to his
statement that the richest Americans pay the largest share of taxes and should
pay no less than the current share.
