Sen. John F. Kerry has just passed another tax onto wealthy Republicans – by having his wife pay half-a-million dollars in back taxes on his yacht.
Kerry has been docking his $7 million, 76-foot yacht, Isabel, in Rhode Island, which has no yacht tax, since he purchased it in March. However, Massachusetts has a 6.25 percent “use” tax on any item bought elsewhere for use in Taxachusetts. State officers regularly track down those purchasing tires, alcohol, or other consumer goods in neighboring states, such as tax-free New Hampshire.
Keeping the boat stashed out-of-state saved Kerry more than $500,000, including “$440,000 in Massachusetts sales taxes and $70,000 in annual excise taxes.” However, the Department of Revenue had begun investigating claims the sloop had been seen off the Nantucket coast.
The senator insisted to the press that the matter was “not an issue,” and testily demanded, “Can I get out of here, please?” But after days of rebuffing reporters for invading his haute monde, Kerry flip-flopped on Tuesday evening and agreed he will “promptly” pay the half-million dollars, “whether owed or not.”
Of course he will not pay the tax on the boat because, like much of John Kerry’s property, it is not John Kerry’s property. The Boston Globe reported Isabel “is officially owned by a company named Great Point LLC in Pittsburgh, a property of a trust that benefits Kerry’s wife, Heinz Ketchup heiress Teresa Heinz Kerry.”
That means Teresa Heinz (who dropped the Kerry surname shortly after the 2004 election) owns the New Zealand-built yacht which, according to the designer’s website, took a year to complete and includes “a wet bar and cold wine storage to entertain up to six around the U-shaped settee and custom teak table.”
Kerry uses the Eeesabell courtesy of Teraysa, who owns the boat largely courtesy of the Heinz family fortune.
When her first husband, Sen. John Heinz, R-PA, died in 1991, Teresa inherited his estate. Following her marriage to Kerry in 1995, public records revealed Teresa had $100 million in assets and $400 million in Heinz stock inherited from John Heinz’s death. By 2004, the Los Angeles Times estimated her net worth had grown to between $900 million and $3.2 billion. Roll Call reports the Heinz fortune lifted John Kerry from the upper middle class – he had $100,000 in assets in 1990 – to the heights of conspicuous consumption.
Teresa controlled not only the Heinz family’s prestige but its institutional wealth. She serves as chairman of the Heinz Endowments, which holds total assets of $1.2 billion and distributes $65 million in grants annually. Her sons Andre and Christopher Heinz sit on its board of directors.
In that capacity, Heinz put her late husband’s money to work for her current hubby’s interests. Through the Heinz Family Foundation, she steered a $250,000 grant to Boston 2004, “the host committee for the Democratic National Convention” – the same convention that nominated her husband and featured prime time addresses from Teresa and an obscure state senator named Barack Obama. The group pampered DNC big shots and lavished gifts on high-dollar Democratic donors, including “a $45,000 reception at the Boston Harbor Hotel, $30,000 in tickets to a Red Sox-Yankees game, and a $50,000 Fenway [Park] reception.”
Heinz grant recipients also protested the 2004 Republican National Convention in New York. Teresa Heinz donated $100,000 in 2002 and another $100,000 in 2004 to The Three Rivers Community Fund (TRCF), whose motto is, “Change, Not Charity!” Its prime beneficiary is the Thomas Merton Center, which vowed “to physically disrupt to the maximum extent possible the functioning of the” 2004 RNC. Its publication, The New People, defended the right of Iraqis to kill U.S. soldiers. An editorial claimed, “On a global scale, the force most effectively preventing the United States government from achieving its imperial aims is the armed resistance in Iraq.”
The year after the RNC disruptions, Teresa awarded the Thomas Merton Center a $10,000 direct grant.
This was not to be the only time she underwrote lawbreaking demonstrators. In 2004, TRCF funds were “used to bring the Ruckus Society to Pittsburgh for a weekend of intensive training” in what the Ruckus Society does best – encourage “direct action” protests like the Seattle anti-WTO riots in 1999. The Ruckus Society was invited to Pittsburgh again last September to protest the G20 summit with TRCF and the Thomas Merton Center.
Mostly, though, Teresa used the Heinz family fortune to underwrite far-Left political causes. She spent hundreds of thousands of dollars to teach environmentalism in the public schools. She gave $100,000 to PAX Christi USA, which called America’s war on al-Qaeda “unjust.” She underwrote an organization that calls the U.S. Constitution “a slave and empire form of governance.”
And she helped her second husband’s political fortunes. While Kerry planned a second presidential run – in the years between the 2004 election and his quip that stupid people get “stuck in Iraq” – Teresa donated heavily to Democratic Party constituency groups. The Heinz Family Foundation donated $25,000 in 2005 to the Gay and Lesbian Victory Foundation (now the Gay and Lesbian Victory Fund). The Teresa & H. John Heinz III Fund of Heinz Family Foundation awarded $50,000 to the organization “Women Voices. Women Vote.” And Teresa gave $50,000 to the Pennsylvania Conservation Voters Education League “to promote collaboration among unions and environmentalists.”
Apparently she did not get too carried away, though. She would not donate her income taxes to help her husband’s constituents. Teresa pays her income tax in Pennsylvania, where taxes are 58 percent of the Massachusetts rate.
And until this month’s expose, she docked her boat in another state to avoid paying her fair share of Massachusetts’ use taxes.
Nautical problems are nothing new for a man whose memory was “seared” with an erroneous image of sailing into Cambodia on Christmas Eve 1968. But if Kerry can understand that he avoids taxes by doing business elsewhere – voting with his sail, as it were – why can’t he understand businesses do the same thing when choosing between high-tax, high-regulation states (or nations) and low-tax, low-regulation alternatives?
And considering how he benefits from Heinz family wealth, perhaps he should rethink his position on the inheritance tax.
Ben Johnson is an Associate Fellow at the National Legal and Policy Center and the author of two books on Teresa Heinz Kerry. Visit his personal website: TheRightsWriter.com.