Trump properties in Indonesia received special tax status
The Indonesian government granted a special tax status to a new development that includes three Trump-branded properties earlier this month, in a move that is likely to financially benefit Donald Trump and appears to have been in the works since long before he left office. This represents yet another entanglement between the Trump brand and a foreign government, just weeks after Trump left the presidency and was freed from constraints on his foreign business deals. As Trump considers seeking the presidency again, deals like this remain enormous conflicts of interest.
The Trump Organization is ensnared in a dense web of conflicts of interest with the Indonesian government and an Indonesian development company. Since 2015 the Trump Organization has partnered with the Indonesian conglomerate MNC Group to build a Trump International Hotel Bali and three Trump-branded projects for the company’s Lido City resort. Earlier this month, the Lido City resort obtained Special Economic Zone (SEZ) status, with financial privileges that will extend to the Trump-branded properties there.
The new tax status for the Indonesian development is a big boost for MNC Group, which says on its website this will make it the country’s premier tourism destination. Trump’s company is paid fees from the property, which is predicted to attract billions of dollars in investments.
The Indonesian press first reported in 2019 that the government would award SEZ status to Lido City, a sprawling vacation “megaproject” which includes Trump-branded villas, a luxury Trump resort, and a world-class Trump golf course. The SEZ is a big deal. According to MNC Group this designation will make the resort, including the three Trump-branded properties inside, eligible for “corporate tax cuts, luxury goods sales tax cuts and … some leniency on permits” in Indonesia. MNC even boasts on their website that with the SEZ, “MNC Lido City will become the national pride and Indonesia’s new tourism destination.” The SEZ did not become official until almost two years after it was first announced, just weeks after Trump left office.
MNC is controlled by Hary Tanoesoedibjo, a long time business partner and friend of Trump. Tanoe, as he is called by the Indonesian press, attended Trump’s inauguration festivities in 2017, and Trump has even referred to Tanoe as his “great friend.” This is also one of Trump’s most lucrative business partnerships. Since the two decided to build the developments in 2015, Tanoe has pledged to spend $1 billion on the resorts and as of 2017 had paid $10.5 million in fees to Trump. Indonesia’s SEZ council predicted the development could attract $2.4 billion in investments and over three million tourists per year until 2038.
The conflicts of interest are massive and increasingly outrageous. From 2018 to 2019 MNC contracted construction firms owned or partially owned by the Saudi Arabian, South Korean, and Chinese governments to build parts of the Trump developments. In February 2019 MNC released a corporate update which stated “aggressive global expansion” of the “Trump International portfolio” was underway with “numerous projects” in the pipeline, seemingly contradicting the Trump Organization’s claim it had halted new business overseas.
In the summer of 2019 Indonesian press reported that Don Jr. was set to attend a “pre-launch event” for the MNC-Trump developments with Tanoe in Jakarta. At the event that August, he mingled with high level Indonesian government officials. In October 2019, Indonesian President Joko Widodo appointed Tanoe’s daughter Angela to a position in his cabinet which gives her power over tourism and therefore over policies that benefit her father’s hotels and the Trump Organization developments. After being appointed Angela even attended a meeting with MNC Group to discuss ways to boost tourism, and of course the MNC Lido City development was mentioned.
In 2018, an Indonesian official dined at the Trump International Hotel during a trip to Washington, D.C. Late last year this same official, Coordinating Minister for Maritime Affairs and Investment Luhut Pandjaitan, attended a closed-door meeting with Trump, Jared Kushner, and Ivanka Trump at the White House. According to press reports the purpose of the trip was to gain the United States’ investment in Indonesia’s Sovereign Wealth Fund. Yet, the White House did not release an official readout of the meeting, and it was left off Trump’s calendar.
When Donald Trump became president he swore that his company, the Trump Organization, would abstain from any new foreign business deals to avoid conflicts of interest with his administration. This was an empty promise. From the day he took the Presidential oath to the moment he fled to Mar-a-Lago to avoid Joe Biden’s inauguration, CREW watched as foreign governments curried favor with Trump by granting trademarks to the Trump Organization and holding expensive events at his properties, while company Executive Vice Presidents Eric and Donald Trump Jr. visited business partners around the world, often at great cost to American taxpayers.
Now that Trump is no longer in office, the Trump Organization can finally reap the rewards of four years of corruption. While the company certainly did not shy away from foreign conflicts during Trump’s presidency, whatever minor constraints it was under are now totally gone. If Trump runs for president in 2024, the Trump Organization may be forced to pretend to cease its foreign business again, making now the perfect time to do business overseas with foreign governments.