Presidential candidate Donald Trump may have legally avoided paying tax for nearly 20 years according to leaked documents obtained by the newspaper the New York Times.
Trump defended himself on twitter by stating he knew the countries tax last better than anyone else so he was the right person to fix them.
According to tax experts hired by the newspaper, the loss recorded in 1995 could have resulted in savings of $50m a year in taxable income over the following 18 years.
Senator Bernie Sanders criticised Trump’s tax dealings by telling ABC, “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.”
However,Rudy Giuliani, former New York mayor, said Trump was a “genius”. He told NBC, “He did something we admire in America: he came back.”
New Jersey governor Chris Christie also said, “This is actually a very, very good story for Donald Trump”.
“This is a guy who, when lots of businesses went out of business in the early 1990s, he fought and clawed back to build another fortune, to create tens of thousands of more jobs,” he told Fox News.
Hillary Clinton said on Twitter, “Three pages of Trump’s tax returns confirm he’s a business failure who’s gotten rich at your expense. Imagine what he’s hiding in the rest.”
Is it OK to avoid paying any tax as all?
This raises a good point about the amount of tax we pay. Everybody wants to pay as little as possible, which is understandable, but is there ever a point when it becomes too beneficial?
Trump advisers including Rudy Giuliani, the former New York City mayor, responded to the report by saying that the billionaire was a “genius” for taking advantage of legal provisions of the tax code to reduce his taxable income.
The case has shone a spotlight on a provision of the personal tax code that is well known to people in business, where it is common to carry forward losses, but has surprised many others.
Some of Mr Trump’s businesses were in financial trouble in the mid-1990s but the emergence of his tax return left many unanswered questions about how he racked up such a large loss.
Tax experts said it was also unclear whether Mr Trump had lost $916m out of his own pocket or whether it was related to property transactions or business operations that he had funded with bank loans.