Forbes Says He Won’t Ask Taxpayers to Pay for Bash

Malcolm Forbes said Wednesday that he has no intention of trying to make U.S. taxpayers foot the bill for his $2-million birthday bash in Morocco--even though he thinks that he could.

Forbes, who held a news conference to deflect criticism that followed speculation that he might try to deduct some party costs from his taxes, said a case could be made for taking a business expense deduction.

“I would say 95%--it’s business related,” Forbes said. “But the question is are we using it as a business deduction?

“It was never intended to be and not a penny of it is. But certainly a case can be made when 75% of your guests are your biggest customers.”

Hundreds of Belly Dancers

The business magazine publisher had been criticized after published reports quoted him and his son, Malcolm Forbes Jr., as saying they considered some of the party costs to be business expenses.

Forbes’ 70th birthday party in Tangier on the north coast of Africa last weekend featured 600 belly dancers, 200 Berber horsemen and a guest list that included Elizabeth Taylor, Henry A. Kissinger, Barbara Walters and such business luminaries as Lee A. Iacocca, Rupert Murdoch, Donald J. Trump and Henry Kravis.

Guests were flown across the Atlantic on three jets, including a chartered supersonic Concorde. The party’s expense has been estimated at $2 million to $3 million, although Forbes said Wednesday that the tab might not exceed $2 million because the government of Morocco paid for part of the event, including guards.

Comments ‘Demagoguery’

Forbes said the party had “real business value to Forbes and its customers” and that as a result of the party Forbes magazine would be launching issues in West Germany with projected issues in Italy, Spain and Japan.

He likened it to the parties for advertisers that most magazines give--and write off--on the grounds that the companies run by many of Forbes’ guests also place ads in his magazine.

Rep. Fortney Stark (D-Calif.) on Tuesday released a letter he sent to Internal Revenue Service Commissioner Fred T. Goldberg saying he hoped the party was not deductible.

“The public’s support of the tax system is destroyed by reports of tax-deductible birthday bashes by belly-dancing billionaires,” Stark wrote. Forbes called Stark’s comments a form of election year “demagoguery.”

The IRS has declined to comment on the party but a spokesman pointed to pertinent sections of the tax code. Section 262 says that aside from a small exception involving telephones, “no deduction shall be allowed for personal, living or family expenses.”