Wouldn't '09 amnesty penalties and interest have spiked Romney's 'average tax rate'
misleadingly high, as would have penalties and interest after audits?
Other threeads here have pointed out that Romney's claimed 1990-2009 average tax rate of 20.2 percent is biased upward for at least one and possibly two reasons:
(1) It includes years before 1997, when capital gains tax rates were almost twice what they are now (see http://www.democraticunderground.com/10021393319 ).
(2) The 'average' is not weighted by the amount of taxable income each year, and would be much lower if Mitt paid high rates in low-income years and low rates in high-income years (see http://www.democraticunderground.com/1251103335 ).
In addition, here's a third major reason Romney's summary could be highly misleading.
On Ed Shultz's MSNBC show this evening, David Cay Johnston pointed out the Price-Waterhouse summary is an average of tax rates "OWED", not tax rates ACTUALLY PAID WHEN DUE for those years. This implies that there were audits and/or amnesties that resulted in make-up payments of taxes for past years, plus penalties and interest.
These make-up payments could have amounted to tens of millions of dollars for 2009, a year when Romney's taxable income very likely was very low because of the Bush recession. Such an astronomically high outlier would make an unweighted 'average tax rate' highly misleading.
The MEDIAN unweighted tax rate for 1990-2009, or the weighted mean, well could be much lower than what Price-Waterhouse reported in its summary.
WHAT'S YOUR OPINION?
= new reply since forum marked as read
