Romney Tax Break Rejected as Welfare for Rich
By Brian Faler - Jan 26, 2012 12:00 AM ET .
As the release of Republican presidential candidate Mitt Romney’s 2010 tax return heats up debate over a 15 percent top rate on so-called carried interest, two-thirds of those surveyed in the Bloomberg Global Poll say the tax break is unjustified. The lower levy helped Romney, former head of Bain Capital LLC, pay an effective rate of 13.9 percent on $21.6 million of income, when the top income tax rate is 35 percent.
Jonathan Sadowsky, chief investment officer at Vaca Creek Asset Management LLC in San Francisco, said he favors eliminating the break because he’s concerned about government deficit spending.
“I’m extremely worried about the debt,” he said. “Somewhere down the line, people are going to stop lending us money.”
About $7.4 million, more than one-third of Romney’s 2010 income, was from carried interest, which is the share of profits that make up most of the compensation for partners in private equity firms, hedge funds and real estate developments. Those fees are taxed as capital gains rather than ordinary income.
Sixty-six percent of poll respondents worldwide said the break isn’t justified, compared with 21 percent who said it is and 13 percent who said they had “no idea.”
Among those living in the U.S., 67 percent said the lower rate isn’t justified,
versus 27 percent who said it is. The Jan. 23-24 poll of 1,209 investors, analysts and traders from around the world has a margin of error of plus or minus 2.8 percentage points.
more @ Bloomberg.com
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