House Democrats want to get their hands on President Trump’s tax returns, and plan to make the issue a key part of their agenda upon taking the majority next year.
A provision in the federal tax code gives the chairs of the congressional panels with jurisdiction on tax policy the ability to request tax returns from the Treasury Department.
That means the Democratic chair of the House Ways and Means Committee will have the authority in January to demand Trump’s tax returns.
{mosads}“What we’re doing here is doing our duty as a legislative branch of government, by checking the potential, possible conflicts of interest in the executive branch of government,” Rep. Bill Pascrell (D-N.J.), a senior member of the House Ways and Means Committee, told The Hill on Thursday.
Democrats were frustrated during the 2016 presidential race when Trump broke with decades of precedent and refused to make his tax returns public. Their interest in getting their eyes on his returns has only grown during Trump’s first two years in office.
Democrats want to know if and how Trump is avoiding taxes, particularly in the wake of a lengthy New York Times story published in early October that said Trump and his family engaged in “dubious” tax schemes in the 1990s so that the president’s parents could avoid gift and estate taxes.
They also want to see how Trump is benefiting from the tax-cut law he signed last year, which to date is his biggest legislative accomplishment. And they want to learn about any conflicts of interest that Trump may have, including any links to foreign governments.
Rep. Lloyd Doggett (D-Texas), the top Democrat on the Ways and Means Subcommittee on Tax Policy, said on a call with reporters Wednesday that obtaining Trump’s tax returns is “important in both guaranteeing our national security and in protecting the integrity of the tax code.”
Democrats have the support of a number of progressive organizations on this effort. On Thursday, a coalition of liberal groups led by Tax March took out a full-page ad in The New York Times urging House Democrats to obtain and make public the returns.
Still, there are risks to the Democratic approach, and Republicans think their rivals could face backlash over investigations into the president.
Senate Majority Leader Mitch McConnell (R-Ky.) said at a press conference Wednesday that “presidential harassment” might not be a smart tactic for Democrats. He pointed out that when Republicans impeached President Bill Clinton in the 1990s, Clinton’s approval rating ended up increasing while Republicans’ approval rating declined.
“The Democrats in the House will have to decide just how much presidential harassment they think is good strategy,” he said. “I’m not so sure it will work for them.”
Democrats, for their part, are vowing to be careful in how they proceed.
“This is not a witch hunt,” Pascrell said.
Under federal tax law, the Treasury secretary “shall furnish” any tax returns requested from the chairman of the House Ways and Means Committee, Senate Finance Committee or Joint Committee on Taxation, provided that the documents are reviewed in a closed session.
After a committee reviews the returns behind closed doors, it could vote to send a report to the full House, and tax-return information in the report could become public.
Over the last two years, Democrats repeatedly tried to get Congress to request Trump’s tax returns from Treasury but failed because they were in the minority in both chambers of Congress. But now that they will have the House majority next year, Rep. Richard Neal (D-Mass.), who is all-but-certain to be the next Ways and Means Committee chairman, will be able to request the documents.
It could be a while before Democrats are able to examine the returns, as Neal and others in his party are bracing themselves for a legal battle.
While Democrats and a number of tax experts say that Treasury has little ability under the statute to refuse to provide the Ways and Means Committee with the returns, they also expect the Trump administration to slow-walk or turn down their request. That could lead to a court fight that eventually makes its way to the Supreme Court.
“I assume that there would be a court case that would go on for a period of time,” Neal said in a press conference in his district.
Trump on Wednesday said he doesn’t want to hand over his tax returns while under audit by the IRS. The agency has said that audits don’t prevent taxpayers from releasing their own information.
“Nobody turns over a return when it’s under audit, OK?” the president said.
A Treasury spokesperson said that “Secretary [Steven] Mnuchin will review any request with the Treasury General Counsel for legality.”
George Yin, a law professor at the University of Virginia who has spoken with Pascrell about the tax return issue, said that in the past when there have been conflicts involving someone resisting requests for information from Congress, courts have ruled that there needs to be a legitimate legislative purpose for Congress’s request.
Democrats are confident they’ll meet that standard.
Doggett said that the returns “serve a legitimate purpose for the work of our committee.”
If Democrats are able to receive Trump’s tax returns following their request, they will face additional challenges. They will have to be careful as lawmakers and their staff review the materials to ensure that no one is violating the law by improperly releasing taxpayer information. Then they will have to decide exactly what portions of Trump’s tax returns they want to make public.
Pascrell said that the examination would be an “academic, rational review” and that there would be “no leakage.” He said that the committee could decide not to make public some or all of the returns.
Requesting Trump’s tax returns is one of a number of actions House Democrats are likely to take next year in order to provide oversight of the administration. But Republicans are warning that Democrats could be hurt politically if they take their investigations too far.
Some tax experts have suggested that Senate Republicans could respond to Democrats’ efforts on Trump’s tax returns by issuing their own politically motivated requests for tax returns.
“You could wind up in a back-and-forth strategy,” said Mark Mazur, a former Obama administration Treasury official who now is director of the Urban-Brookings Tax Policy Center.
Democratic lawmakers say they would be discerning with their review of Trump’s tax returns.
“I think it has to be done with care,” Doggett said. “We’re not interested in oversight just for oversight’s sake.”
House Minority Leader Nancy Pelosi (D-Calif.), the favorite to become Speaker next year, said that when Democrats pursue oversight activities, “we’ll know what we’re doing, and we’ll do it right.”