Trump flap shows need to fix the flawed and unfair US tax system

Wealthy business people are able to exploit the taxation system in ways that ordinary citizens cannot, so promising reform would be a good strategy

PUBLISHED : Sunday, 09 October, 2016, 1:05am
UPDATED : Sunday, 09 October, 2016, 1:05am

Files that suggest American Republican Party presidential candidate Donald Trump potentially did not pay taxes for two decades have understandably sparked outrage. During campaigning, he has often denounced others for avoiding payments, yet has repeatedly made excuses for refusing to release his own returns. The details published by the New York Times have been neither dismissed nor confirmed as genuine by his campaign team, although the opportunity has been used to praise his business skills and how, if he gets elected, he could use them to boost the US economy. Wealthy business people like the real estate tycoon are in some places in the world able to exploit the taxation system in ways that ordinary citizens cannot, so promising reform to make it more egalitarian would be a better response.

Has Donald Trump avoided paying US federal taxes for 18 years?

Trump and his opponent, the Democratic Party’s Hillary Clinton, have both campaigned for taxation changes, although their proposals would not fundamentally alter the system. Clinton wants the wealthy to pay more so that initiatives can be funded while Trump seeks lower rates to stimulate economic growth. But the controversy highlights a matter that neither has raised: A tax code with more than 74,000 pages that applies mostly to companies and rich individuals. It is inevitable, given the complexities, that there are sections to be exploited and corporations and the wealthy are best placed to hire professionals to help them reduce payments.

The files do not detail the extent of tax avoidance. Use of loopholes are the hallmarks of a shrewd businessman, but the same behaviour would be inappropriate for a public official. Such people are expected to be honest, upstanding and transparent in all their activities. That is why although presidential candidates are not required to release their tax returns, most do so anyway.

Much frustration has been directed at Trump, but there is nothing illegal about what he and others like him are able to do. Instead of crowing about business acumen, he should vow to right a system that is flawed and unfair.