The President may have a higher rate than Warren Buffett and Mitt Romney.
Following a leak of his 2005 tax returns on Tuesday, it emerged that Donald Trump paid $38 million in federal taxes on $153 million of income that year. That translates into an effective tax rate of around 25%– relatively low, though it dispels past reports that the president may have paid no tax at all.
The leaked returns were confirmed by the White House, and pre-empted a much hyped unveiling on MSNBC’s “Rachel Maddow Show,” which had obtained partial filings. The documents suggest that, at least in some years, the former “Apprentice” host had a higher effective rate than other public figures. A large chunk of the $38 million bill was due to the alternative minimum tax, a tax designed to prevent higher income people from using loopholes to avoid taxes. The president paid more than $30 million thanks to the AMT.
Signing my tax return…. pic.twitter.com/XJfXeaORbU
— Donald J. Trump (@realDonaldTrump) October 15, 2015
Trump boasted in a presidential debate with Hillary Clinton that his ability to minimize his tax rate reflected his savvy as a businessman, but other big names have lower tax rates. For instance, investing legend Warren Buffett had an effective tax rate of 17.3% in 2010, when he paid $6.9 million on $39.8 million of taxable income. Mitt Romney, the 2012 Republican presidential nominee, paid $1.3 million on $13.69 million of income in 2011, or an effective rate of 14.1%
Trump had been the only major party presidential nominee in recent decades not to release his tax returns. He had claimed that his recent filings were being audited by the Internal Revenue Service, though the agency has said that doesn’t preclude him from releasing his filings.
In a statement about the leaks, the White House said: “The dishonest media can continue to make this part of their agenda while the president will focus on his, which includes tax reform that will benefit all Americans.”
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