Romney: I paid at least 13% in taxes

August 16, 2012: 4:37 PM ET
mitt romney, presidential candidate, ohio, campaign, republican
GOP presidential candidate Mitt Romney says he has never paid less than 13% of his income in taxes
NEW YORK (CNNMoney)

Republican presidential candidate Mitt Romney said Thursday he never paid less than 13% in taxes, batting back criticisms that he hasn't paid enough to the federal government.

"I did go back and look at my taxes and over the past ten years. I never paid less than 13%," he said on the campaign trail in Greer, S.C. "I think the most recent year is 13.6 or something like that. I paid taxes every single year. "

The presumptive GOP nominee has faced criticism over the release of his tax returns, including a charge by Senate Democratic Leader Harry Reid that Romney paid no taxes in ten years. Democrats want Romney to release more tax returns than the full tax returns for 2010 and a summary for 2011 he's produced already.

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In declaring he's paid more than 13% in taxes, Romney is describing his effective tax rate, the percentage of his actual income he gave to the federal government. Over the past two years, Romney's effective tax rate was 14.5%, based on the records he's revealed already.

Effective tax rates are always lower than top income tax rates, due to credits, deductions and exemptions that cancel out all or much of the income tax many Americans would otherwise owe in taxes. Some 80% of Americans have an effective rate below 15%, according to the Tax Policy Center.

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For families making $50,000 to $75,000, the effective tax rate is 5.7%. From $75,000 to $100,000, it's 7.2%. And if you make $200,000, it goes up to 9.9%.

However, households at the highest income brackets -- like Romney's -- make a lot of their money from tax-advantaged investments, such as capital gains and tax-free bonds. And they tend to have a lot of itemized deductions, which can greatly reduce how much they owe the tax man.

"Most of us don't get most of our income from capital gains and dividends," said Roberton Williams, a senior fellow at the Tax Policy Center. "Romney is in that group of people who really, really benefit from low tax rates on capital gains and dividends."

Romney's financial disclosures suggest his net worth is as high as $264 million, making him one of the wealthiest candidates in history to seek the U.S. presidency.

Despite Romney's assertions of paying taxes, Sen. Reid is not taking back his accusations.

"We'll believe it when we see it," said Reid spokesman Adam Jentleson. "Until Mitt Romney releases his tax returns, Americans will continue to wonder what he's hiding."

CNNMoney's Jeanne Sahadi contributed to this report.
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