In this May 24, 2007, file photo, Donald Trump is profiled against his then-under construction 92-story Trump International Hotel & Tower in Chicago.
| Photo Credit: AP

Former U.S. president Donald Trump may face an IRS bill in excess of $100 million after a government audit indicates he double-dipped on tax losses tied to a Chicago skyscraper, according to a report by The New York Times and ProPublica that drew on a yearslong audit and public filings.

The report’s findings could put renewed focus on Mr. Trump’s business career as the presumptive Republican nominee tries to regain the White House after losing in 2020.

Mr. Trump used his cachet as a real estate developer and TV star to build a political movement, yet he has refused to release his tax filings as past presidential candidates have. The tax filings that the public does know about have come from past reporting by the Times and a public release of records by Democrats on the House Ways and Means Committee in 2022.

Mr. Trump’s presidential campaign provided a statement in son Eric Trump’s name saying the IRS inquiry “was settled years ago, only to be brought back to life once my father ran for office. We are confident in our position”. The tax records cited by the report indicate that Mr. Trump twice deducted losses on the Trump International Hotel and Tower, which opened in 2009 near the banks of the Chicago River that cuts through that city’s downtown.

The report said Mr. Trump initially reported losses of $658 million in his 2008 filings under the premise that the property fit the IRS definition of being “worthless” because condominium sales were disappointing and retail space went unfilled amid a deep U.S. recession.

But in 2010, the published report said, Mr. Trump transferred the ownership of the property to a different holding company that he also controlled, using the move to save money on taxes by reporting an additional $168 million in losses over the next decade on the same property.

The report did not have any updates on the status of the IRS inquiry since December 2022, but said Mr. Trump could owe more than $100 million, including penalties, if he were to lose the audit battle.

Mr. Trump, meanwhile, is appealing a New York judge’s ruling from February after a civil trial that Mr. Trump, his company and top executives lied about his wealth on financial statements, conning bankers and insurers who did business with him. In early April, Mr. Trump posted a $175 million bond, halting collection of the more than $454 million he owes from the judgment and preventing the state from seizing his assets to satisfy the debt while he appeals.

Democrat President Joe Biden has said that Mr. Trump largely owes his fortune to an inheritance from his father, rather than through his own financial acumen. Mr. Biden has gone after Mr. Trump for not wanting to pay taxes, while his administration has increased IRS funding in order to increase audits of the ultra-wealthy and improve compliance with the federal tax code.

The Trump campaign opposes the additional funding that Mr. Biden and Democrats provided to the IRS. At campaign rallies, Mr. Trump has said the United States would be destroyed as a country unless his 2017 tax cuts that are largely set to expire after 2025 are extended.

Finance Minister Nirmala Sitharaman with Union MoS for Finance Pankaj Chaudhary, Revenue Secretary Sanjay Malhotra and others during the 52nd Goods and Services Tax (GST) Council Meeting, in New Delhi, on October 7, 2023.
| Photo Credit: PTI

The Goods and Services Tax (GST) Council has decided to raise the maximum age limit for the president and members of the GST Appellate Tribunals, Finance and Corporate Affairs Minister Nirmala Sitharaman announced after the 52nd Council meeting.

The president can have a tenure up to the age of 70, raised from 67 earlier, while the cap for members has been raised from 65 to 67. The minimum age of appointment, which was not specified earlier, is now recommended to be 50 years.

“We wanted it to be clear that advocates with up to ten years of experience must be minimum for consideration to become judicial members of the tribunals,” said Ms. Sitharaman.

The GST Council also decided that food preparations of millet flour in powder form, with at least 70% of the composition as millets in the blend, will have a 0% GST if sold loose or packed without any branding and labelling, and 5% only if sold pre-packaged and in a labelled form.

Taxing extra-neutral alcohol

Another critical decision taken that Ms. Sitharaman said would have major implications in Centre-State ties was that though the GST Council had, by law, the right to tax the extra-neutral alcohol (ENA), the Council has ceded that right to tax ENA to the States.

“It’s States’ decision now to tax it or not to,” she said. “This has been done in the interest of the States.”

The Allahabad High Court had earlier ruled that States had lost their competence to levy a tax on ENA.

The GST on molasses has been reduced from 28% to 5%, which the Minister said would benefit sugarcane farmers and will enable them to get paid faster from the sugar mills.

“We also believe that it will reduce the cost of cattle feed. The GST rate notification will be amended to create a new entry for extra-neutral alcohol for industrial use and that shall attract 18% tax,” she said.

On services, in order to promote tourism, the Council has given a conditional exemption to foreign-flag, foreign-going vessels, from the levy of Integrated GST, if they convert temporarily for a coastal run.

“In other words, for the next couple of months, in the winter, let’s say foreign run vessels do cruise tourism along India’s coast, we have decided to exempt them from 5% IGST normally levied. This will promote tourism particularly on the Western coast, from Mumbai to Kochi, and even the eastern coast,” said Ms. Sitharaman.