Raise your hand if you’re paying more tax than Donald Trump. That’s the new, derisive battle cry of his political opponents, after the disclosure by The New York Times that in 2016 and 2017, despite his gaudy wealth, he paid only $ 750 (now converted $ 644) annually in federal income tax.
The newspaper brought this to light on Sunday after inspecting nearly two decades of Trump’s tax returns, which he himself refuses to disclose. The survey found that despite his image as a successful real estate mogul and billionaire, he often paid less federal income tax than an average American household, a potentially damaging revelation in the run-up to the Nov. 3 election.
In eleven of eighteen years of research, Trump paid no federal income tax at all, mainly by spreading out large losses from his business empire over several tax years. Such tax tactics, not available to most ordinary Americans, underscore that many of the president’s business interests, including hotels and golf courses, are chronically at a loss.
To the outside world, he presents them as successes. For example, in public reports in 2018, he reported a turnover of almost 435 million. He secretly reported more than 47 million in losses to the tax authorities.
Trump dismissed the reports as “fake news”, according to the NYT based on legally obtained documents. “I paid many millions in taxes but, like everyone else, was entitled to write-offs and tax credits”, tweeted he Monday.
Still, the revelations raise serious questions. At best, observers say they show what many already suspect: that Trump is not as good a businessman as he would have the public believe. For example, he invested income from the successful early years of his reality TV show The Apprentice in loss-making businesses such as hotels and golf courses.
In the worst case, observers say tax tactics point to tax fraud. In itself, offsetting losses against taxable income is a legal form of tax avoidance, a means the rich use to lower their tax bills. Trump’s accountants, from Mazars USA, have been aggressively helping him do this for years, and their services may become more sought after by the wealthy.
The NYT reports unexplained payments of “consulting fees,” including nearly $ 750,000 to his daughter Ivanka, an employee of the family business. He then wrote off these dearly paid advice as business expenses. Experts say this may indicate tax evasion, a federal crime. Trump also wrote off, among other things, $ 70,000 in hairdressing costs as a business expenditure.
The impression is given that Trump’s finances went so downhill in 2015 after the initial success of The Apprenticethat he ran for president to boost his brand name; without seriously expecting to win. It is mainly his brand name as a wealthy businessman that makes him money, partly because real estate companies pay to use the name Trump.
According to the newspaper, Trump is under pressure as hundreds of millions of dollars in debt he has personally guaranteed to be paid off in the coming years. It is unclear who the creditors are and whether he is indebted to foreign interests. The tax authorities are also investigating a refund of nearly 73 million that Trump has received as of 2010. He may owe the US tax authorities, the IRS, about $ 100 million for that.
Critics point out that Trump can debunk the reporting by only disclosing the pages of his tax returns with the amount paid and his signature. Instead, he merely reiterated on Twitter that he “has long said” he may “release” his financial statements. He denies being in deep debt. “I have very little debt compared to the value of my assets.”
Code name ‘magnate’
The question is whether the revelations harm the president in his campaign. His appeal for many is based on his reputation as a successful businessman, uniquely positioned to lead the economy. His secret service code name, ‘Mogul’ (magnate), is even based on it. This image, which was already clear to many to be at odds with a series of bankruptcies, is now under further pressure.
Also read:Is power for sale at the Trump hotel?
Trump is known for barely bothering negative revelations. Sound recordings were made in 2016 Access Hollywood outside where he bragged about harassment of women. While this was seen as a death blow to his campaign, he survived the scandal.
His low tax bill is admirable to his loyal fans. In a 2016 election debate, Hillary confronted Clinton with several years already known to have not paid federal income tax. “This means that I am smart,” he interrupted. Loyalists see it as a credit to outsmart the federal government, which they perceive as too pushy.
A version of this article also appeared in NRC Handelsblad of September 29, 2020
*The article has been translated based on the content of Source link by https://www.nrc.nl/nieuws/2020/09/29/trumps-imago-van-succesvol-zakenman-verder-onder-druk-a4013959
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