Seattle millionaire on Trump taxes: That’s messed up
Millionaire Nick Hanauer is not down with how Donald Trump is skirting his taxes.
Hanauer spoke with KUOW’s Bill Radke about Trump’s recently revealed tax returns from 1995, exposed by The New York Times. Those tax returns show that Trump reported a nearly $1 billion loss that would have allowed the Republican presidential nominee to avoid paying federal income tax for nearly two decades.
“The far right and people like Trump have promulgated this idea that if rich people don't pay tax, somehow that will be good for everybody, and that's a lie,” Hanauer said. “There's no empirical evidence for that. But you can do simple math. And there's just no way to sustain our democracy unless people like Trump and myself pay taxes.”
Hanauer doesn’t pay more taxes than he should. But he said he doesn’t seek out “tax avoidance schemes,” either.
“The tax code is riddled with holes and loopholes, and folks like Trump are very, very good at taking advantage of those loopholes,” he continued. “It is worth saying that I do think it is fair to be able to write off losses in your taxes. I'm a successful investor, but I am no stranger to economic catastrophe.
“Probably a third of the things I've done ended in disaster. I think it's legit to write off those losses against gains I might have made elsewhere.”
But Trump has gone beyond the pale, Hanauer said.
“It is astonishing to not pay any income taxes and claim at the same time to be worth $10 billion. One of those things has to be false,” he said.
Don’t all people look for angles on their tax returns, Radke asked?
Hanauer said middle class people don’t have this luxury, because the tax code doesn’t provide that flexibility for regular income earners.
“If you're an ordinary, income earning taxpayer there's very little wiggle room,” he said. “You basically have an income and it's a particular tax rate. And you know there's a couple of things you can write off and that's it.
“If you have 20 corporate entities going simultaneously in a variety of businesses in a bunch of states, then there's so many games that you could play.”
Hanauer, a Democrat, argues the tax code should be revised “in a way that makes it impossible for the wealthiest citizens to pay less tax than middle class people do as a percentage of their income.”
He called the current system “economically unsustainable” and a moral abomination.
Hanauer elaborated on one way the superrich avoid taxes – the carried interest loophole.
“If you run a private equity firm, your income is treated as capital gains rather than ordinary income,” he said. “You're taxed at 20 percent rather than the 42 or 43 that ordinary income would be taxed.”
He continued: “This is just a 20 percent giveaway to the richest people in our society for no reason whatsoever – other than it just makes the rich richer.”