Perot proposal would lower his taxes

October 15, 1992|By Saul Friedman | Saul Friedman,Newsday

WASHINGTON -- Texas billionaire Ross Perot, whose economic plan calls on the nation to participate in a "fair-share sacrifice," pays a smaller share of his income in taxes than most Americans and stands to pay even less under his proposal, according to a study of his holdings and to sources familiar with his finances.

Precise figures are not available because Mr. Perot has refused to make his income-tax returns public or discuss his finances, and his office declined to return repeated calls.

But a spokesman has confirmed the accuracy of a Fortune magazine survey that put Mr. Perot's net worth at $3.3 billion. And earlier this year, he listed the approximate value of his assets and their yield with the Federal Election Commission.

Mr. Perot's disclosure showed that upwards of two-thirds of his income is from municipal bonds, sheltered from federal taxes. As a result of that tax-free income and other tax breaks, Mr. Perot currently pays about 6.8 percent of his earnings in federal taxes, according to a computer-based estimate that the Citizens for Tax Justice, a non-partisan, labor-funded group here, made for Newsday.

And that analysis estimated that under his plan, which includes tax cuts as well as tax increases that would affect him marginally, Mr. Perot could end up doing slightly better than he does now -- paying about 6.7 percent of income, for a savings of about $200,000.

To be sure, even under the citizens group's conservative estimates, Mr. Perot paid Uncle Sam a substantial sum -- at least $15.8 million last year on an estimated gross income of $230.4 million.

But according to the Congressional Budget Office, the estimated portion of his income paid in federal taxes is only slightly higher than the 6.2 percent paid by the average taxpayer, earning $30,000 a year, and it is far below the 11 percent average share of gross income paid by all taxpayers.

What Mr. Perot is estimated to pay is a smaller share than what his rivals in the presidential campaign pay. President Bush's 1991 tax return shows that he and first lady Barbara Bush paid more than 15 percent of their gross income in taxes, or nearly $205,000 on gross income of $1.3 million. And according to Gov. Bill Clinton's return, he and his wife, Hillary, paid about $49,800 in federal taxes on an income of $244,356 -- or about 20 percent.

Furthermore, while Mr. Clinton paid another $12,424 in Arkansas state income taxes, Texas does not have an income tax, which means Mr. Perot's income was not subject to state taxes. Mr. Bush -- who owns a home in Kennebunkport, Maine, but owns a lot in Houston and claims a hotel room there as his legal residence -- also pays no state income tax.

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