By Bernie Becker - 09/29/12 02:50 PM EDT
One left-leaning group is trying to use Mitt Romney’s own generosity against Republicans in the fight over whether the wealthy should pay more in taxes.
But with Republicans stressing that Warren Buffett and others who want higher taxes on the wealthy can just cut the IRS a check, the left-leaning group essentially said that Romney was the exception that proved the rule.
Democrats have also said the idea of using voluntary tax payments to beat back deficits was laughable.
“Aside from the occasional multi-millionaire who runs for president and wants to avoid answering difficult questions about the policies that allow him to pay so little, can we expect many wealthy Americans to voluntarily pay for public services and public investments?” CTJ asked in a blog post.
“No. We cannot pay for roads, schools, aircraft carriers and many, many other public goods with voluntary contributions.”
The blog post is the latest in the debate over whether the highest earners are paying a high-enough tax rate, with the back-and-forth taking center stage in both the presidential race and in the halls of Congress. It also comes as how to tax investment income is increasingly looking like a key question as policymakers look to revamp the tax code.
Romney’s own tax returns – the candidate’s 2011 return shows he paid a 14 percent rate – have played a role in that debate as well. The former private equity executive’s rates, which Democrats note are well below what more middle-class families pay, are low largely because much of his income comes from capital gains.
Senate Democrats passed a bill this year that would raise rates on family income above $250,000 a year, and also pushed unsuccessfully for the so-called “Buffett Rule” – named for the billionaire investor, who famously said that he paid a lower rate than his secretary.
Republicans, meanwhile, want to extend all current tax rates for a year, and have talked up a bill – crafted in response to Democratic Buffett Rule legislation – that would make it easier for wealthy taxpayers to increase their own tax burden.
“You can put your money where your mouth is,” Rep. Steve Scalise (R-La.), the sponsor of the House bill, said last year. “That’s what this bill does.”
Citizens for Tax Justice has said that Buffett Rule legislation – which would basically have made those making multimillions of dollars a year pay at least a 30-percent rate – didn’t go far enough.
The group wants to tax capital gains and ordinary income at the same level, which was the case after the last broad reform of the tax code in 1986. Experts at a recent congressional hearing on taxing capital gains also said policymakers would need to consider that option.
But Romney and other Republicans have said there are plenty of good reasons for capital gains to be taxed at a lower rate. Some experts, for instance, warn that taxing investment income too much could discourage saving.
The GOP nominee himself made that case in a recent “60 Minutes” interview.
“It’s the right way to encourage economic growth, to get people to invest, to start businesses, to put people to work,” Romney said.