President Trump volunteered information on his tax affairs last night for the first time since entering politics after a portion of one of his returns was leaked to the press.
Documents obtained by DCReport.org, an investigative news site, showed that Mr Trump and his wife, Melania, paid $38 million in taxes in 2005 on income of about $150 million.
They paid $5.3 million in regular federal income tax in 2005 — a rate of less than 4 per cent. However, the couple paid a further $31 million in “alternative minimum tax” — a form of levy that is designed to prevent Americans from reaping too much benefit from income tax deductions. The forms also show that the Trumps paid more than $1.8 million dollars in self-employment tax.
The White House scrambled to pre-empt the leaked tax documents after an American TV station revealed that it had obtained them. “Before being elected president, Mr Trump was one of the most successful businessmen in the world with a responsibility to his company, his family and his employees to pay no more tax than legally required,” it said in a statement.
It added: “That being said, Mr Trump paid $38 million, even after taking into account large-scale depreciation for construction, on an income of more than $150 million, as well as paying tens of millions of dollars in other taxes such as sales and excise taxes and employment taxes and this illegally published return proves just that.”
The documents published by DCReport.org were the first two pages of what appeared to be Mr Trump’s federal tax return for 2005. They appeared to show that he continued to make use of a loss of nearly a billion dollars he had recorded a decade earlier to reduce his tax bill.
Throughout the campaign opponents demanded that Mr Trump release his full tax returns, a tradition that dates back to Richard Nixon, though he only did so after he was elected. The Democrats have argued that his tax documents could shed light on whether Mr Trump has received money or loans from foreign sources. A tax return could also, potentially, show whether he held overseas bank accounts, had business dealings with Russia or other potential conflicts of interest.
The White House lashed out at the media for publishing Mr Trump’s tax return. “You know you are desperate for ratings when you are willing to violate the law to push a story about two pages of tax returns from over a decade ago,” it said, adding that it was “totally illegal to steal and publish tax returns”. The journalist who obtained the documents, David Cay Johnston, said that he had found them in his mailbox.
Mr Trump said that he could not release his tax returns because he was under audit by the Internal Revenue Service. The IRS has said that an audit does not stop an individual from releasing tax returns.
Last October it was revealed that he had lost $916 million in 1995, potentially allowing him to reduce his tax bills for the next 18 years.
He later cited his tax affairs as evidence of his business acumen, saying he prided himself in paying as little as possible. He also argued that only the media was interested in the issue. “The only one that cares about my tax returns are the reporters,” he said in January, shortly before his inauguration.
“You learn very little from a tax return,” he added at the time.
Before his election victory surveys did suggest that Mr Trump’s tax affairs were not a priority for voters.