Romney’s remarks on the campaign trail in South Carolina rebutted recent charges by Democratic Senate Leader Harry Reid that Romney paid zero taxes in the past decade, but it didn’t satisfy Democrats.

President Obama’s campaign manager Jim Messina wrote a letter to Romney’s campaign manager asking that the Republican presidential candidate release five years’ worth of tax returns.

“….if the Governor will release five years of returns, I commit in turn that we will not criticize him for not releasing more—neither in ads nor in other public communications or commentary for the rest of the campaign,” Messina wrote.

Romney’s campaign manager Matt Rhoades rejected the offer, saying, “It is clear that President Obama wants nothing more than to talk about Governor Romney’s tax returns instead of the issues that matter to voters, like putting Americans back to work, fixing the economy and reining in spending.”

To date, Romney has released his 2010 tax return, and an estimate for 2011. His campaign has said he’ll release his 2011 return when it’s completed (Romney had filed an extension).

Romney said Thursday this “fascination” with how much taxes he’s paid is “very small-minded.”

The real issue for Romney, says The Daily Ticker’s Aaron Task, is the way the tax code is structured, which allows very wealthy people to pay a negligible amount of income tax.

In Romney’s case, his association with Bain Capital lets him claim income from the private equity firm as “carried interest” or capital at risk, which is taxed at 15%.

“It’s totally unfair that private equity fees should be treated as capital at risk,” says Henry Blodget. Romney is paying a tax rate that is lower than half of Americans.”

Romney still enjoys that low rate even though he hasn’t worked at Bain Capital for years — a point he makes repeatedly on the campaign trail.

“He’s distancing himself intellectually and philosophically, but if you look at his returns he’s still essentially working at Bain Capital,” says Task.