Democratic Senator Bernie Sanders voiced criticism about Republican presidential nominee Donald Trump’s past business practices on ABC’s This Week related to a New York Times story published on Saturday that revealed Trump took advantage of tax loopholes to avoid paying taxes for up to 18 years after he declared a $ 916 million loss on his 1995 income tax returns.
The Times story underscored the huge tax benefits that Trump reaped in return from his steep financial losses in the 1990’s attributed to three Atlantic City casinos, a failed airline, and a poorly timed purchase of the Plaza Hotel in Manhattan.
Tax experts cited in the New York Times story noted that Trump could have benefited from the tax laws that allowed him to use his $916 million loss to wipe away the same equivalent dollar amount of taxable income over an 18 year period.
The documents obtained by the Times also showed in 1995 Trump reported $7.4 million in interest income and yet paid a mere $ 6,108 in wages, salaries, and tips.
Genius or Manipulation?
On ABC’s This Week, former New York Mayor Rudy Giuliani called Trump a “genius” at how he took advantage of “legal remedies” that can help your company to prosper.
However, Vermont Senator Bernie Sanders showed no affinity for Trump’s past tax practices and maintained that we wouldn’t have a country if everyone was a “genius” like Trump and found a way to avoid paying taxes.
Sanders explained on ABC’s This Week that the U.S. has a “corrupt tax system” with massive income and wealth inequality and yet billionaires like Donald Trump are able to manipulate the tax system so that they avoid paying federal income tax.
During Trump’s campaign, he criticized hedge funds for taking advantage of tax loopholes with carried interest even though the new release of his 1995 income tax statement shows that he also took advantage of tax loopholes with his own businesses.
Despite Trump’s ability to take advantage of tax loopholes and avoid paying taxes, his campaign responded to the Times story on Saturday by claiming in a statement that Trump is the man to fix the U.S. tax code.
“Mr. Trump knows the tax code far better than anyone who has ever run for President and he is the only one that knows how to fix it” the Trump campaign statement reads.
Trump has referred to himself as the “king of debt” on the campaign trail and spoke in May on CNBC’s Squawk Box about how he would like to get “discounts” with the United States’ outstanding sovereign debt through a process of lowering rates of repayment with creditors.
“No, I don’t want to renegotiate the bonds, but I think you can do discounting. I think, depending on where interest rates are, I think you can buy back. I’m not talking about with a renegotiation, but you can buy back at discounts, you can do things at discounts” Trump said on May 5th during a radio interview with hosts from CNBC’s Squawk Box.
Trump has adopted an economic policy that relies mostly on steep tax cuts to generate growth.
According to analysis from the non-partisan Tax Foundation, Trump’s latest revised tax plan “would reduce revenues by between 2.6 trillion and $3.9 trillion after accounting for the larger economy, depending on the nature of a key policy provision.”
While working as a business man, Trump took advantage of cheap labor costs by outsourcing work overseas yet he has been a fierce critic of other U.S. businesses that engage in the same outsourcing practices and claims that he wants to bring home American jobs by renegotiating U.S. trade policies.