Rustling up votes for the GOP tax plan, President Donald Trump on Tuesday reportedly assured Senate Democrats that he would not personally benefit from the proposal. In fact, he insisted, his accountant told him he will be a “big loser” if the House Republican tax bill passes. “The deal is so bad for rich people, I had to throw in the estate tax just to give them something,” the president said.
At least one of those statements is false. The deal is good for rich people. Wealthy people’s after-tax incomes would rise at a substantially higher rate than for those lower down the income scale, according to an analysis of the House GOP tax plan that the nonpartisan Tax Policy Center released Wednesday.
What about Trump’s own finances? There’s good reason to doubt Trump’s veracity there, too. But because, unlike every other president of the modern era, he refuses to make his tax returns public, we can’t be sure. If Trump wants to prove that he is promoting tax reform despite, not because of, his own financial interest, there is an easy way to do so: He can finally release his tax returns.
Trump’s story is not outside the realm of possibility. The professional staff at Congress’s Joint Committee on Taxation found that the House GOP bill would cut taxes for most rich people but not all. About a quarter of households with an income over $1 million would see a tax increase in 2019, in part because the bill would scale back tax breaks, such as the write-off for state and local taxes. That write-off might be quite valuable to the president, a longtime businessman in high-tax New York.
Yet the House GOP bill also contains provision after provision seemingly designed to help someone such as Trump. It would eliminate the alternative minimum tax, a policy that ensures the wealthy can’t use loopholes to shrink their tax burden to nothing. The AMT obliged the president to pay $31 million in 2005, the one year for which the public has summary information about his taxes.
The bill would reform how the federal government taxes “pass-through” income from certain privately held companies - companies of the sort that Mr. Trump used extensively in his real estate business. As Trump noted Tuesday, it would phase out the estate tax, an unnecessary shift that would amount to little more than a giveaway to wealthy families such as the Trumps. And then there are complex details such as how the tax bill singles out the real estate business for special consideration in how it handles corporate interest and like-kind exchanges.
Trump’s comments underscore a reason every major-party presidential candidate since Richard Nixon has released his or her tax returns. The public should know what conflicts of interest the president has, particularly when questions of taxing and spending are on the table. The president says GOP tax reform is not about enriching himself. A Congress with a modicum of self-respect would answer: Great to hear. Now show us.