Presidential candidate Donald Trump has been under heavy pressure in the recent months to release his tax returns to the public, and some investigators are digging deeper into the possible scandal as a result of several tax forms of Trump’s finding their way to the light. These documents show that Trump might have avoided paying taxes for the last 18 years by claiming incredible losses in the years prior.
Despite the numerous Republican candidates at the start of the race, Trump was the sole candidate to refuse to release his tax returns. That should have been a giant red flag to the entire country from the start, especially considering the reason Trump has given for his intransigence. He has stated on multiple occasions that he can’t release his statements due to a lofty audit of his empire currently being conducted by the IRS. Of course, there is no such provision during a tax audit, so Trump clearly has another reason for the secrecy. Perhaps he doesn’t want the American people to know that he isn’t as rich as he claims, or that he’s actually lost more money than he has made. Perhaps he is trying to hide the fact that his charitable organization, the Trump Foundation, isn’t so charitable after all. He might even be attempting to cover up his business dealings and partnerships from his business career.
The New York Times recently discovered that Donald Trump lost over $900 million in 1995, which is the supposed claim he made on his tax returns that allowed him to forgo paying income tax for 18 years. However, there are reports that Trump has gone out of his way to avoid paying taxes of any sort wherever he can. One example from 1986 involved sales tax fraud.
Trump had a deal set up with a jewelry store from the Bulgari brand. He would agree to make his pricey jewelry purchases for his wife and daughters exclusively from the brand if they would do something to help him avoid paying what he considered unfair sales tax. Trump would enter the store, located in New York City, and would purchase a piece of jewelry. Normally, Bulgari would apply sales tax that would then go on to the state. However, Trump would have the store pretend to ship the jewelry to an out-of-state address, typically a random property in his portfolio.
When a store sells something to an out-of-state buyer, the store is not required to pay sales tax on those transactions, so they don’t charge the tax to their customers. The only way a store would have to charge sales tax on an out-of-state purchase is if they own a store or corporate location in the destination state, which was not the case for Bulgari and Trump. The fraud occurred when Bulgari would simply mail an empty box to the out-of-state address while Trump carried the jewelry out of the New York store.
At the time, Trump was found out and forced to testify against Bulgari in order to stave off potential charges on himself. Trump bought more than the equivalence of $140,000 worth of jewelry after inflation from the 1986 rate.
Trump is often heralded as a tax genius by those who support him, but there are a number of problems with that claim. First, Trump himself does very little in the way of preparing his taxes. He has teams of accountants and advisors that give him options, and he uses the tax code to his full advantage, regardless of whether or not the practices make ethical or moral sense. For instance, Trump once filed for a grant meant to help small businesses survive after 9/11. The grant for was for $150,000, which is a drop in the bucket compared to his empire, yet he felt the need to take that opportunity from another business that actually needed it.