Harry Reid’s office let out more details on what is becoming a popular parlor game, determining who told him about Mitt Romney’s tax returns.
“This person is an investor in Bain Capital, a Republican also, and somebody who has been dealing with Romney’s company for a long, long time and he has direct knowledge of this,” said Reid aide Jose Parra, referring to Romney’s tax returns [...]
Parra teased the details in an interview with Mario Solis-Marich on KTLK’s Diverse LA radio program, according to audio of the show provided by the station.
Later, Parra backpedaled and said he didn’t know the party affiliation of the source, though he sounded pretty confident on the radio show.
This set off a round of fevered speculation, with Markos Moulitsas musing that the source was Jon Huntsman, Sr., a Reid donor who is business partners with the managing director for Bain (a separate blogger pointed to Huntsman, Jr., who ran for President this year). I don’t think it’s been established that Huntsman, Sr. invested in Bain, which is the most definitive detail we have, but we do have a Huntsman connection to this story. Abby Huntsman, daughter of Jon Jr. and granddaughter of Jon Sr., co-authored a story with Ryan Grim back in July that cited “Bain sources.”
Meanwhile, while the Obama campaign has kept their distance from Reid’s specific claim, they pull on a separate thread in a new TV ad, highlighting the “Son of Boss” tax scandal, where Romney, in a role as head of the auditing committee for Marriott, personally approved of a tax shelter that reported fictional losses of over $70 million. Just to have some fun, the ad throws in a Romney interview with ABC News where he says he doesn’t know if he ever paid a lower tax rate than the 13.9%, asking out loud whether Romney ever paid 10,5 or 0% in taxes in a given year. “Isn’t it time for Romney to come clean,” the ad concludes. The Obama camp sent out a memorandum stressing all these tax avoidance strategies revolving around Romney.
First, CNN published an op-ed by two tax experts who describe in detail a shelter employed by Marriott – and overseen by Romney – to report fictional losses exceeding $70 million. Romney was the head of the company’s audit committee at the time Marriott employed this strategy that the experts, Peter C. Canellos and Edward D. Kleinbard, call “perhaps the largest tax avoidance scheme in history.” Marriott was on the vanguard of tax avoidance, and the op-ed’s authors rightly note that the Republican nominee’s “endorsement of this stratagem provides insight into Romney’s professional ethics and attitude toward tax compliance obligations.”
Second, Bloomberg News reported that under Mitt Romney’s leadership, Bain Capital avoided taxes by funneling the profits it made from buying and selling Italy’s version of the Yellow Pages through a shell corporation in Luxembourg, a widely recognized tax haven. The billion-dollar deal was “one of the biggest windfalls” of Romney’s tenure at Bain.
Additionally, the Los Angeles Times reported that the Romneys went to great lengths to lower their property-tax bill on their $12 million La Jolla, Calif., home. The story raises questions about whether the Romneys grossly exaggerated the devaluation of their beachfront mansion to lessen their tax burden.
This is really not what the Romney campaign wants to talk about, and they’ll spend the next three months trying to talk about something else. Where this connects to policy – and Romney’s tax plan, which envisions even lower tax rates on wealthy people with tax avoidance strategies like him – that will be a tall order.