Late-night TV host John Oliver has frequently used his Last Week Tonight program to criticize America’s wealth gap (see video above) and the lawmakers who are only helping to widen it, especially Donald Trump. However, a new report indicates that Oliver himself may have dodged major taxes by exploiting some of the very tactics that those lawmakers helped forge.
A story recently published by the Observer claims that Oliver exploited several loopholes, including one pioneered by Trump himself, to avoid enormous tax payments on the New York penthouse that he and his wife purchased in 2015.
City records indeed show that Oliver purchased the Upper West Side luxury penthouse for $9.5 million via a shell corporation, Hoagie’s Place, LLC, named after Oliver’s dog.
Given New York City property tax laws that favor the super rich in luxury buildings like these, Oliver was allowed to pay far lower taxes on his penthouse than he otherwise would have.
This brought the Oliver property’s tax assessment down from the $9.5 million that he paid to just $515,000, the Observer writes.
Then, Oliver got a second break via the 421-a tax exemption. Created by New York City in the 1970s to encourage development in underutilized areas by lowering taxes for property developers, the effective use of the exemption was changed forever and brought it into its modern form by none other than Trump.
In 1980, Trump and his lawyers successfully sued the city in order to use the 421-a exemption to pay far lower taxes on Trump’s building of the Trump Tower on Fifth Avenue — not exactly underutilized area in need of development. Thus, what started as a way to reinvigorate depressed areas instead became a tool for the wealthy to only increase their wealth.
And in Oliver’s case, the 421-a exemption brought his penthouse’s tax assessment down from $550,000 to about $250,000, This means that Oliver paid just $27,343 in taxes on his $9.5 million penthouse in 2016 — a tax rate of just 0.25 percent.
In response, the Observer wrote that Oliver’s representatives did not reply to a request for comment. However, a follow-up from Salon elicited the following response from Oliver’s camp:
“The apartment was purchased through a trust, solely for privacy reasons – the trust confers no tax benefit whatsoever. As for the 421a tax exemption, the rate at which the city taxes the building in which Mr. Oliver lives was the result of the building developers applying for that exemption before construction years before he took up residence. It was not the result of any action or decision taken by Mr. Oliver.”
Regardless of whether or not Oliver knowingly exploited tax loopholes or merely benefited passively from a system built to favor the very wealthy, that system remains firmly in place today. Just last month, the New York State Legislature reinstated the 421-a tax exemption, which had expired in 2016. The Daily News reports that the 421-a exemption will cost the city $1.3 billion in foregone tax revenue this year alone.
Next, see where Donald Trump gets his news. Then, read up on three times that Donald Trump made millions by defrauding hundreds of people.