By Ellen Asermely
By Ellen Asermely
Rabat – U.S. presidential candidate Donald Trump has repeatedly touted his business acumen as a main qualification to hold office. The billionaire real estate mogul has, however, used questionably legal methods to achieve his financial success.
Trump has perhaps not paid any federal income taxes in decades, though he refuses to release his tax returns to the public, something which every presidential candidate, regardless of party, has done in the past 40 years. The New York Times recently released information from Trump’s 1995 tax documents, revealing how, in the 1990s, faced with financial ruin, Trump avoided paying hundreds of millions of dollars in taxable income.
How could he accomplish this legally? This week, the Times disclosed new documents shedding light on the questionably legal tactics he used. As his casino network struggled in the 1990s, Trump asked his financial backers to forgive hundreds of millions of dollars of debt that he was unable to repay.
This cancelled debt, however, would be viewed by federal tax policy as hundreds of millions of dollars in taxable income. The Times explains how, by exploiting a loophole in the law, Trump gave shares of his business in exchange for the cancelled debt, allowing him to avoid reporting the debt relief as taxable income. This practice has since been made explicitly illegal.
Essentially, Trump gained massive tax benefits for losing millions of dollars of other people’s money. He made a tax bill of hundreds of millions of dollars disappear.
The question remains: is this the kind of businessman who should be running the United States? One who pushes the law beyond recognition, loses enormous amounts of money, and is rewarded for it? Or should this be viewed as a smart tactical maneuver used by Trump to save his failing company?