White House and Treasury discussed Trump tax return request, Steven Mnuchin says
WASHINGTON >> Treasury Secretary Steven Mnuchin told lawmakers today that White House lawyers had been in touch with his department about a congressional request for President Donald Trump’s tax returns, but said he had not personally spoken to Trump or those lawyers about how the matter was being handled.
Mnuchin’s disclosure is the first public acknowledgment of communication between the White House and the Treasury Department related to Trump’s tax returns and underscores the seriousness with which the president is taking the congressional request to obtain his personal financial records.
Mnuchin, who is testifying before two congressional committees today, acknowledged that White House lawyers had been in touch with his department before the formal request was made last week. But he said that he had not been briefed on those discussions and described them as “informational.”
“Our legal department has had conversations prior to receiving the letter with the White House general counsel,” Mnuchin said. “I acknowledge there were conversations. I am not briefed on the full extent of those conversations.”
Mnuchin said it would be “premature” to comment on how his agency would respond to a formal request by House Democrats for six years of Trump’s personal and business tax returns.
“It is our intent to follow the law,” Mnuchin said. “It is being reviewed by the legal departments, and we look forward to responding to the letter.”
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But when pressed by House Democrats, Mnuchin suggested he believed that Congress was overreaching its authority and defended Trump’s right not to release his tax returns.
“The general public when they elected President Trump made the decision to elect him without his tax returns being released,” Mnuchin said, adding that the president complied with requirements to release a financial disclosure form.
The request for Trump’s tax returns is putting Mnuchin, one of his most loyal aides, at the center of what is shaping up to be an extraordinary legal battle between two branches of the U.S. government.
A decision on whether to turn Trump’s tax returns over to Congress is expected to fall to the IRS and Mnuchin, whose Treasury Department oversees the tax collection agency. While Mnuchin has been fairly cautious in discussing the request, Trump and his top advisers have made it increasingly clear that they will not allow the president’s tax returns to be released without a fight.
Mnuchin suggested that an attempt to obtain tax returns for political purposes could ultimately harm both parties and give lawmakers discretion to obtain financial records of political enemies. Mnuchin noted that Rep. Kevin Brady of Texas, who was the Republican chairman of the Ways and Means Committee during the Obama administration, did not make such requests.
“I am sure there are many prominent Democrats who are relieved that when Kevin Brady was chairman of the committee that he didn’t request specific returns,” Mnuchin said.
Mnuchin’s turn in the spotlight comes at a delicate moment for the Treasury secretary. Mnuchin, one of the longest-serving members of Trump’s Cabinet, has been dogged in recent weeks by questions over his financial ties to the film industry, as well as questions surrounding the Treasury Department’s removal of sanctions against a trio of companies controlled by an influential Russian oligarch. Mnuchin has also been at the center of Trump’s growing frustration with the Federal Reserve, which he publicly blames for slowing U.S. economic growth. Trump has aimed much of his criticism at the Fed chairman, Jerome H. Powell, whom the president installed to the top job on the recommendation of Mnuchin.
Mnuchin’s handling of the matter will be watched closely by Trump, who has kept his tax returns closely guarded despite promises as a candidate to eventually release them. Democrats are using a little-noticed provision of the tax code to request the documents, and the Trump administration has asserted that those efforts are outside the bounds of congressional authority and that the request is nothing more than political harassment. Last week, Rep. Richard E. Neal, the Massachusetts Democrat who leads the House Ways and Means Committee, requested that the IRS hand over six years of Trump’s tax returns.
“The Democrats will never be satisfied, no matter what they get, how much they get, or how many pages they get,” Trump said in a tweet Monday. “It will never end, but that’s the way life goes!”
Mick Mulvaney, the president’s acting chief of staff, said over the weekend that Democrats would “never” obtain the president’s taxes and called their efforts “a political hit job.”
Last Friday, Trump’s personal lawyer asserted Trump’s right as a citizen to keep his tax returns private and told the Treasury Department not to hand the returns over to House Democrats.
Mnuchin and the IRS have until the end of Wednesday to comply with Neal’s request, based on a deadline he outlined last week. What comes next depends on their answer. The Treasury secretary told reporters after the hearing that it would be a “good guess” that his department would respond to the request by the Wednesday deadline.
If the IRS complies, Neal is unlikely to immediately say anything else to the public. If the agency objects to the request or does not answer, Neal could press his case and warn the agency that House Democrats will view not handing over the documents as a violation of the law.
At that point, Neal is likely to turn to the courts to try to enforce his request, teeing off a legal battle that could take months or years to sort out and could wind up at the Supreme Court.
Rep. Tom Suozzi, D-N.Y., a member of the Ways and Means Committee, said Monday that he believed the IRS would not comply with Neal’s request and would seek instead to further “politicize” the issue. He said he expected Neal to turn to the courts to try to force compliance with the law.
“Mnuchin obviously has a very close relationship with the president, he is very loyal to the president,” Suozzi said in an interview. “But he has an oath of office that requires him to follow the law. And I believe the law is very clear here. It could be damaging to his and other people’s reputations if they were to try to interfere with their obligation.”
Congressional Republicans have taken a starkly different stance.
On Monday, Rep. Kevin Brady of Texas, the top Republican on the Ways and Means Committee, called the quest for Trump’s taxes a “fishing expedition” and said Americans would come to regret it if members of Congress could obtain private tax information for political purposes.
“The president is absolutely right to be fighting this,” Brady said on Fox News. “This is not a legitimate request. It has no legal, legislative purpose.”
Mnuchin has been more cautious when discussing the looming battle. In an interview in October, he said that if Democrats won the House and requested the tax returns, he would work with the general counsels for the Treasury Department and IRS to determine if the request was legal.
At a congressional hearing last month, however, Mnuchin was more explicit, saying that protecting taxpayer privacy was paramount.
“We will protect the president as we would protect any individual taxpayer under their rights,” Mnuchin said.
If the fight over Trump’s tax returns drags on, Mnuchin will most likely be navigating it without two of his closest aides. The secretary announced last week that Eli Miller, his chief of staff, was departing. Tony Sayegh, Mnuchin’s top communications official, is also expected to leave in the coming months. Politico first reported that Sayegh had been interviewing potential successors.
Mnuchin is also operating without an undersecretary for international affairs. David Malpass, who held that position, was approved last week to lead the World Bank. The top domestic policy position at the Treasury Department continues to go unfilled. And Mnuchin’s assistant secretary for legislative affairs has yet to be confirmed.
Mnuchin might try to defer a decision on Trump’s taxes to the department’s lawyers, but ultimately he will probably have to weigh in and defend the president.
Former IRS officials have suggested that privacy will be Mnuchin’s strongest argument and that the administration will probably look to undercut the nature of the House Democrats’ request for the returns as part of the committee’s oversight of “the extent to which the IRS audits and enforces the federal tax laws against a president.”
Lawrence B. Gibbs, a former IRS commissioner who was its chief counsel during the Nixon administration, noted that the provision Democrats were using to seek Trump’s returns was drafted at a time when the tax code was being rewritten to improve protection of taxpayer privacy. Despite the language in the code, which appears to clearly give Congress the power to access anyone’s tax returns, a request that is political in nature could ultimately be shot down by the Supreme Court.
“This goes way beyond the president,” Gibbs said. “If our politicians, at either end of Pennsylvania Avenue, can obtain taxpayer information, taxpayers have to wonder if there really is confidentiality anymore.”
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