President denies report he paid tiny amount in income taxes
Donald Trump has denied a bombshell report from The New York Times, which claims the self-described billionaire paid just $US750 in income tax the year he was elected President.
In an investigation published today, the newspaper reported that Mr Trump had also paid just $750 the following year, in 2017 – and “no income taxes at all” in 10 of the previous 15 years.
Why? Because in those years, the businessman and reality TV host “reported losing much more money than he made”.
The Times said its reporting was based on tax return data it had obtained “extending over more than two decades”. It promised additional articles would be published “in the coming weeks”.
“The tax returns that Mr Trump has long fought to keep private tell a story fundamentally different from the one he has sold to the American public,” wrote reporters Russ Buettner, Susanne Craig and Mike McIntyre.
“His reports to the IRS (Internal Revenue Service) portray a businessman who takes in hundreds of millions of dollars a year, yet racks up chronic losses that he aggressively employs to avoid paying taxes.
“Now, with his financial challenges mounting, the records show that he depends on making money from businesses that put him in potential and often direct conflict of interest with his job as President.”
They concluded that “ultimately, Mr Trump has been more successful playing a business mogul than being one in real life”.
Mr Trump has refused to release his tax returns to the public since before the 2016 election. He has repeatedly justified that refusal by claiming they are under audit by the Internal Revenue Service (IRS).
All the way back in February of 2016, the IRS issued a statement clarifying that “nothing prevents individuals from sharing their own tax information”.
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TRUMP LABELS IT ‘TOTALLY FAKE NEWS’
We will delve further into the details of the Times’ investigation shortly, but first, we should stress that Mr Trump has strenuously denied its veracity.
He spoke to reporters at a White House media briefing shortly after it was published.
“That is fake news. That is totally fake news, made up, fake,” Mr Trump said.
“We went through the same stories, you could have asked me the same questions four years ago. I had to litigate this and talk about it. Totally fake news, no.
“Actually I pay tax. You will see that as soon as my tax returns – it’s under audit, they’ve been under audit for a long time.
“The IRS does not treat me well. They treat me like the Tea Party, like they treated the Tea Party, and they don’t treat me well. They treat me very badly.
“You have people in the IRS, they treat me very, very badly. But they’re under audit, and when they’re not, I would be proud to show it.”
In the early 2010s, the IRS was accused of targeting organisations affiliated with the Tea Party – a populist faction of the Republican Party.
The years since then have made the scandal a bit hazier. A report from the Treasury Department’s inspector-general report found the IRS had actually subjected a large range of groups seeking tax-exempt status to extra scrutiny, including hundreds of liberal-leaning organisations.
“You have to understand that, when Americans read that you may have paid only a few hundred dollars in federal income tax per year, that seems very low for someone who’s a billionaire,” one reporter told Mr Trump as the media conference continued.
“Well basically, they’re saying I paid nothing,” the President interjected.
“Can you give people an idea of how much you actually are paying?” the reporter asked.
“You know, basically – well first of all, I’ve paid a lot. And I paid a lot of state income taxes too,” Mr Trump said.
“The New York state charges a lot, and I’ve paid a lot of money in state. It’ll all be revealed, it’s going to come out.”
“When?” the reporter pressed.
“After the audit,” he said.
WHAT THE TAX RECORDS SHOW
Mr Trump often points to the annual financial disclosure he releases as President to further justify keeping his tax returns private.
According to The Times, those disclosures give us a “distorted picture” of Mr Trump’s finances, because they report revenue instead of profit.
To illustrate the point, it cited 2018, when the President’s financial disclosure revealed revenue of $435 million. The tax records obtained by the newspaper show his real bottom line that year was a loss of $47 million.
“Most of Mr Trump’s core enterprises – from his constellation of golf courses to his conservative-magnet hotel in Washington – report losing millions, if not tens of millions of dollars year after year,” the newspaper said.
“His revenue from The Apprentice and from licencing deals is drying up, and several years ago he sold nearly all the stocks that now might have helped him plug holes in his struggling properties.
“And within the next four years, more than $300 million in loans – obligations for which he is personally responsible – will come due.”
When Mr Trump started to run for President in 2015, citing his business acumen as a reason to elect him, his accountants were finalising his tax return from the previous year.
It became the fourth consecutive year in which he paid zero dollars in income tax.
He had been earning millions of dollars through his role in The Apprentice and various branding deals, then losing it through risky investment decisions.
“That equation is a key element of the alchemy of Mr Trump’s finances – using the proceeds of his celebrity to purchase and prop up risky businesses, then wielding their losses to avoid taxes,” said The Times.
More to come.