Trump
campaign faces biggest crisis yet after tax documents published
Republican
threatens lawsuit as leaked returns fuel questions over business
acumen – and suggest he may have been able to avoid income tax for
years
Dan Roberts in
Washington
@RobertsDan
Monday 3 October
2016 08.39 BST
Donald Trump was
reeling from the biggest crisis of his campaign on Sunday, after the
publication of documents suggesting the wealthy Republican nominee
may have been able to escape paying income tax for nearly two
decades.
In a direct
challenge to his claim to be a successful businessman and a champion
of America’s hard-working middle class, the anonymously leaked tax
returns reveal how Trump used aggressive accounting tactics and the
failure of several businesses to claim a loss of $916m in his 1995
personal filing.
Independent experts
say under US rules, this could be large enough to legally shelter
hundreds of millions in income from years of federal tax – despite
Trump’s high-rolling lifestyle and criticism of others for avoiding
tax.
Trump did not deny
the damning conclusions drawn by the New York Times, which first
received the filing in a manila envelope said to have been sent from
inside Trump Tower. But he threatened to sue the newspaper for what
he insisted was “illegally obtained” material.
“The only news
here is that the more than 20-year-old alleged tax document was
illegally obtained,” the campaign said in a statement, “a further
demonstration that the New York Times, like establishment media in
general, is an extension of the Clinton campaign, the Democratic
party and their global special interests.”
The editor of the
New York Times recently said he was prepared to risk prison to
publish Trump’s hitherto secret tax returns. The Times pointed out
in its report that the documents it had obtained did not suggest
Trump had done anything illegal.
The veracity of the
document was also confirmed by Trump’s former accountant, Jack
Mitnick, who told the paper he had to manually input the figure in
question because tax preparation software did not allow for
nine-digit losses.
Instead, the Trump
campaign embarked on a damage control exercise on Sunday, dispatching
surrogates to television talk shows to argue that Trump was clever to
exploit the painful collapse of his past business ventures, several
of which defaulted on creditors by declaring bankruptcy.
“The reality is
he’s a genius,” former New York mayor and Trump supporter Rudy
Rudy Giuliani told NBC. “He did something we admire in America: he
came back.” New Jersey governor Chris Christie also told Fox News
Sunday the story was “very good” for the candidate as it showed
“the genius of Donald Trump”.
The argument is
consistent with an explanation given by the candidate himself, who
claimed he was being “smart” when pressed by his rival, Hillary
Clinton, on tax avoidance during their first presidential debate.
In 2012, Trump
berated people who don’t pay tax payers, writing: “Half of
Americans don’t pay income tax despite crippling govt debt”.
Yet the scale of the
1995 loss appears to confirm suggestions made by Democrats that Trump
has refused to follow 40 years of tradition and publish his tax
returns because they would show he didn’t pay any.
“Trump is a
billion-dollar loser who won’t release his taxes because they’ll
expose him as a spoiled, rich brat who lost the millions he inherited
from his father,” Democratic Senate minority leader Harry Reid said
on Sunday.
“Despite losing a
billion dollars, Trump wants to reward himself with more tax breaks
on inherited wealth while stiffing middle-class families who earn
their paychecks with hard work.”
The revelations
follow a poor debate performance, sliding poll numbers and a week of
distracting arguments with a former Miss Universe winner, whom Trump
had called “Miss Piggy” in the 1990s. On Friday Trump falsely
accused her of having a “sex tape” only hours before reporters
found he had made a cameo in a Playboy video.
Many such
embarrassments have failed to dent Trump’s popularity in the past,
but the tax question goes to the heart of his claim to represent
struggling US workers.
Trump has proposed a
tax plan that would cut taxes for all Americans, but analysis by the
conservative Tax Foundation found it would disproportionately help
the richest Americans, saving them millions.
“You have
middle-class people working longer hours for low wages, they pay
their taxes,” said Senator Bernie Sanders, whose battle against
Clinton for the Democratic nomination drew on similar anger over
inequality.
“They support
their schools, they support their infrastructure, they support the
military, but the billionaires, no, they don’t have to do that
because they have their friends on Capitol Hill. They pay zero in
taxes,” Sanders told ABC on Sunday.
“So Trump goes
around and says, ‘Hey, I’m worth billions, I’m a successful
businessman, but I don’t pay any taxes, but you, you who earn 15
bucks an hour, you pay the taxes. That’s why people are angry and
want real change in this country.”
In a statement,
Trump’s campaign defended his record, saying he “is a
highly-skilled businessman who has a fiduciary responsibility to his
business, his family and his employees to pay no more tax than
legally required”.
“That being said,
Mr Trump has paid hundreds of millions of dollars in property taxes,
sales and excise taxes, real estate taxes, city taxes, state taxes,
employee taxes and federal taxes, along with very substantial
charitable contributions.”
The campaign offered
no specifics about how much Trump may have paid in these taxes, or
when.
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