Mitt Romney has proudly declared that he has never paid less than 13% in taxes.
Which begs the question;
13% of what?
I have waited in vain for anyone in either the MSM, or the Blogosphere to ask this question.
In our tax system, all marginal tax rates are meaningless numbers when you consider the deductions/loop-holes that exist to minimize the amount of income which is being taxed.
The average person can be excused for misunderstanding this issue because most of those loop-holes do not effect W-2 wages.
Most people will never see income from capital gains, just as most will never be effected by the inheritence tax.
Most people cannot avoid counting income made in other countries, or take deductions for the expenses related to moving businesses they happen to own to other countries.
Here’s a link to a graphic that represents the history of our country’s top marginal tax rates, it clearly represents the results of forty odd years of the successful efforts on the part of rich and powerful people to minimize their tax contributions to the cost of government.
Over that forty years or so, the very rich, investors, and corporations have paid less and less of the cost of the government which we all rely on, as the people in the middle, and at the bottom have paid more and more.
OTOH, most working people understand their tax bill as being some percentage of the wages they earn as reported on their W-2 form.
The important part of that reality is that there is very little that the average wage earner can do to drive their taxable income below a certain number, so when a wage earner says that they pay a particular percentage of their income in taxes, it means something that their neighbors can probably understand, and relate to.
When Mitt Romney loudly proclaims he has always paid at least 13%, it probably means nothing remotely like what he intends us to believe.
In fact, I’d say that when Mitt Romney says he has always paid at least 13%, it means less than nothing, unless he also tells us 13% of what.