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Friday, September 21, 2012

Ryan Seeks to Deflect Attention Away From Romney\'s Tax Returns


BARTOW, Fla. - Representative Paul D. Ryan sought to reframe attention on Friday away from the low effective tax rate that Mitt Romney pays compared to many Americans who earn much less, by emphasizing that Mr. Romney and his wife, Ann, gave away about $4 million to charity in 2011.

“I think what this shows is that the Romneys are extremely generous people,” said Mr. Ryan, who was named as the vice-presidential candidate last month by Mr. Romney, the Republican presidential nominee. “They gave away 30 percent of their income to charity.”

“Mitt Romney's always believed, ‘To whom much is given, much is required,' and he's living proof of that,” Mr. Ryan added. “And this just shows you how generous the Romneys are as people.”

Mr. Romney paid an effective federal tax rate of 14.1 percent in 2011, according to information his campaign released on Friday. Mr. Romney's federal taxes have been a major political issue because of the comparatively low overall rate he has paid despite earning millions of dollars, especially when so-called payroll taxes for Social Security and Medicare are factored in, which, for most people, eat up a decent chunk of their income but are barely a factor for the Romneys since payroll taxes are only paid on a certain level of income.

Moreover, most of Mr. Romney's income is taxed at low capital gains rates instead of higher rates applied to so-called ordinary income like salaries, which explains why he pays a lower effective rate than so many people who earn far less money than he does.

The Obama campaign has sought to use the Romneys' low effective tax rate as proof of why the tax system is skewed too heavily in favor of the wealthy, and Obama aides have also sought to portray the Republican challenger as an out-of-touch millionaire who uses offshore accounts and owes much of his personal financial success to aggressive tax maneuvers.

But it was clear on Friday that Mr. Ryan and others close to the Romneys were seeking to focus attention on Mr. Romney's large charitable donations as a way of deflecting the Obama campaign's attacks.

What was also notable about Mr. Romney's tax disclosure on Friday was that he actually did not claim all the charitable deductions he was entitled to, Romney advisers said, in order to make good on his earlier statement that in recent years he has always paid at least a 13 percent effective rate.

In fact, Mr. Romney claimed a deduction for just slightly more than half of his total charitable contributions in 2011, though tax experts said it is possible he could still deduct the unclaimed donations in future years.

But Mr. Ryan seemed to dismiss the significance of Mr. Romney limiting his deductions for 2011, suggesting it is always hard to know what your true tax rate will be before you actually complete your tax returns.

“That's because when you pay estimates, that's how it works,” Mr. Ryan said, in brief comments to reporters at a fruit stand here.