New York legislature clears release of Trump tax returns

Members of the New York state Assembly vote on legislation that authorizes state tax officials to release, if requested, individual New York state tax returns to Congress, during a session in the Assembly Chamber at the state Capitol. (AP Photo/Hans Pennink)

New York lawmakers gave final passage to legislation Wednesday that would allow President Donald Trump’s state tax returns to be released to congressional committees that have, so far, been barred from getting the president’s federal filings.

The Democrat-led Senate and Assembly both approved the measures Wednesday, sending them to Gov. Andrew Cuomo, a Democrat. A spokesman has said the governor supports the principle behind the legislation but will review the bill carefully before deciding whether to sign it.

The legislation doesn’t target Trump by name, but it would allow the leaders of the U.S. House Ways and Means Committee, the Senate Finance Committee or the Joint Committee on Taxation to get access to any New York state tax returns filed by elected officials and top appointed officials. The legislation would apply to personal income tax returns, as well as business taxes paid in New York.

An earlier version of the proposal that passed the state Senate two weeks ago would have allowed congressional committees to get any New Yorker’s returns, regardless of whether they held public office. Lawmakers later narrowed the legislation to address concerns that it went too far, prompting the Senate to hold a second vote on the new language Wednesday.

New York Republicans have railed against the bill. John Flanagan, who leads the Senate GOP, called the legislation “troubling” and “bad public policy.”

Fellow GOP lawmakers said the new proposal’s narrower focus shows Democrats went too far with their first proposal, which would have required state tax officials to hand over any New Yorker’s state tax returns.

“This bill is nothing more than political showmanship, and we all know it,” said Assembly Andrew Goodell, who represents a mostly rural western New York district.

Republicans also blasted Democrats for going after the president instead of focusing on challenges closer to home.

“The fact that we’re talking about taxes in this house is ironic because we’re not talking about the taxes that New Yorkers pay, which are the highest in the nation,” said Rob Ortt, a senator from the Buffalo area.

But the proposals’ Democratic sponsors — Sen. Hoylman, of Manhattan, and Assemblyman David Buchwald, of Westchester County — said the legislation promotes government transparency at a time when Americans need to know whether their elected leaders are putting the public’s interest first.

“We are affirming Congress’ role as a co-equal branch of government and the sacred constitutional principle that nobody is above the law, not even the highest elected official in the land,” Hoylman said.

The proposed changes to state law were made amid a battle going on in Washington over Trump’s federal returns.

Democrats are seeking six years of Trump’s personal and business tax returns to aid a committee investigation into whether the IRS is doing its job properly to audit a sitting president and whether the law governing such audits needs to be strengthened.

Treasury Secretary Steven Mnuchin has said he wouldn’t comply with a congressional subpoena seeking six years of Trump’s tax returns, in part because the request “lacks a legitimate legislative purpose.” U.S. Rep. Richard Neal, D-Mass., chairman of the House Ways and Means Committee, has threatened to go to court to get the administration to comply.

New York is Trump’s home state and headquarters of many of his business enterprises. Much of the information on his state returns would mirror the information included on a federal return, giving the Democrats a potential end run around the IRS if they wished to take it.

If Congress does request and obtain Trump’s state tax returns, that doesn’t mean the public gets to see them. Under federal law, the confidential information in the returns is supposed to be for the committee’s eyes only.

The New York bills have no time limitation on the tax filings that could be shared with Congress. They require that the returns be requested “for a specified and legitimate legislative purpose,” wording that could ostensibly give state officials the ability to refuse some requests they felt were primarily political in nature.

The New York bills would become law immediately upon being signed by Cuomo, though it could be delayed by a court challenge.

Passage of the legislation came just a few hours before a federal judge in Manhattan refused to block congressional subpoenas seeking financial records from two banks that did business with Trump.

The judge said subpoenas from lawyers for the House Financial Services and Intelligence committees have “a legitimate legislative purpose” in their investigation into Trump, his family and his company’s dealings with Deutsche Bank and Capital One.

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Congress subpoenas Trump’s tax returns

House Ways and Means Committee Chairman Richard Neal, D-Mass., is joined at right by Rep. Tom Reed, R-N.Y., at a hearing on taxpayer noncompliance on Capitol Hill in Washington, Thursday, May 9, 2019. Neal issued subpoenas for six years of President Donald Trump’s tax returns on Friday. (AP Photo/J. Scott Applewhite)

A top House Democrat has issued subpoenas for six years of President Donald Trump’s tax returns, giving Treasury Secretary Steven Mnuchin and IRS Commissioner Charles Rettig a deadline of next Friday to deliver them.

Ways and Means Committee Chairman Richard Neal, D-Mass., issued the subpoenas Friday, just days after Mnuchin refused to comply with demands to turn over Trump’s returns. Mnuchin told the panel he wouldn’t provide Trump’s tax records because the panel’s request “lacks a legitimate legislative purpose,” as Supreme Court precedent requires.

Neal reminded the two Trump appointees in a Friday letter that federal law states that the IRS “shall furnish” the tax returns of any individual upon the request of the chairmen of Congress’ tax-writing committees and that Ways and Means “has never been denied” a request.

The White House and the Democratic-controlled House are waging a multi-front battle over investigations into Trump and the administration has been refusing to comply across the board, refusing to comply with subpoenas for the unredacted report by Special Counsel Robert Mueller and documents related to the testimony by former White House Counsel Donald McGahn.

If Mnuchin and Rettig refuse to comply with the subpoenas, Neal is likely to file a lawsuit in federal court. He indicated earlier this week that he was leaning toward filing a court case immediately but changed course after meeting with lawyers for the House.

Neal originally demanded access to Trump’s tax returns in early April. He maintains that the committee is looking into the effectiveness of IRS mandatory audits of tax returns of all sitting presidents, a way to justify his claim that the panel has a potential legislative purpose. Democrats are confident in their legal justification and say Trump is stalling in an attempt to punt the issue past the 2020 election.

In rejecting Neal’s request earlier this week, Mnuchin said he relied on the advice of the Justice Department. He concluded that the Treasury Department is “not authorized to disclose the requested returns and return information.” Mnuchin has also said that Neal’s request would potentially weaponize private tax returns for political purposes.

Republicans say Neal is using the arcane 1924 law that empowers him to obtain any individual’s tax filing to play politics with Trump. Democrats also want to probe into Trump’s business dealings, particularly his business relationships with foreigners and to see who he owes money to.

“Your request is merely a means to access and make public the tax returns of a single individual for purely political purposes,” said ranking Ways and Means panel Republican Kevin Brady, R-Texas.

“While I do not take this step lightly, I believe this action gives us the best opportunity to succeed and obtain the requested material,” Neal said in a statement.

Trump has privately made clear he has no intention of turning over the much-coveted records. He is the first president since Watergate to decline to make his tax returns public, often claiming that he would release them if he was not under audit.

“What’s unprecedented is this secretary refusing to comply with our lawful … request. What’s unprecedented is a Justice Department that again sees its role as being bodyguard to the executive and not the rule of law,” said Rep. Bill Pascrell, D-N.J. “What’s unprecedented is an entire federal government working in concert to shield a corrupt president from legal accountability.”

But the president has told those close to him that the attempt to get his returns was an invasion of his privacy and a further example of what he calls the Democrat-led “witch hunt” — like Mueller’s Russia probe — meant to damage him.

Trump has repeatedly asked aides as to the status of the House request and has not signaled a willing to cooperate with Democrats, according to a White House official and two Republicans close to the White House.

He has linked the effort to the myriad House probes into his administration and has urged his team to stonewall all requests. He also has inquired about the “loyalty” of the top officials at the IRS, according to one of his advisers.

Trump has long told confidants that he was under audit and therefore could not release his taxes. But in recent weeks, he has added to the argument, telling advisers that the American people elected him once without seeing his taxes and would do so again, according to the three officials, who were not authorized to speak publicly about private conversations and spoke on condition of anonymity.

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Associated Press writer Jonathan Lemire contributed to this report.

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House committee wants Trump’s tax returns

House Ways and Means Committee Chairman Richard Neal, D-Mass., arrives for a Democratic Caucus meeting at the Capitol in Washington. (AP Photo/J. Scott Applewhite)

A House committee chairman formally asked the IRS to provide six years of President Donald Trump’s personal tax returns and the returns for some of his businesses as Democrats try to shed light on his complex financial dealings and potential conflicts of interest.

The request by Massachusetts Rep. Richard Neal, who heads the tax-writing House Ways and Means Committee, is the first such demand for a sitting president’s tax information in 45 years. The unprecedented move is likely to set off a huge legal battle between Democrats controlling the House and the Trump administration.

Neal made the request Wednesday in a letter to IRS Commissioner Charles Rettig, asking for Trump’s personal and business returns for 2013 through 2018. He asked for the documents in seven days, setting an April 10 deadline.

Trump told reporters Wednesday he “would not be inclined” to provide his tax returns to the committee.

An IRS spokesman said the agency had no immediate comment on Neal’s request.

Democrats insist that obtaining Trump’s tax filings falls within their mandate of congressional oversight. Republicans have denounced it as a political witch hunt and invoked privacy concerns.

“We have completed the necessary groundwork for a request of this magnitude, and I am certain we are within our legitimate legislative, legal and oversight rights,” Neal said in a statement Wednesday evening.

Rep. Kevin Brady of Texas, the senior Republican on the Ways and Means panel, denounced the move as “an abuse of the tax-writing committees’ statutory authority.”

“Weaponizing our nation’s tax code by targeting political foes sets a dangerous precedent and weakens Americans’ privacy rights,” Brady wrote in a letter Wednesday to Treasury Secretary Steven Mnuchin, who oversees the IRS. “As you know, by law all Americans have a fundamental right to the privacy of the personal information found in their tax returns.”

The legal battle set to ensue could take years to resolve, possibly stretching beyond the 2020 presidential election.

Trump broke with decades of tradition for presidential candidates by refusing to release his income tax filings during his 2016 campaign. He has said he won’t release them because he is being audited, even though IRS officials have said taxpayers under audit are free to release their returns. Trump claimed at a news conference following the November election that the filings are too complex for people to understand.

The IRS has a policy of auditing the tax returns of all sitting presidents and vice presidents, “yet little is known about the effectiveness of this program,” Neal said in the statement. “On behalf of the American people, the Ways and Means Committee must determine if that policy is being followed, and if so, whether these audits are conducted fully and appropriately.”

Neal continued, “In order to fairly make that determination, we must obtain President Trump’s tax returns and review whether the IRS is carrying out its responsibilities.”

Neal is one of only three congressional officials authorized under to make a written request to the Treasury secretary for anyone’s tax returns. The Internal Revenue Service is part of the Treasury Department. A rarely used 1924 law says the Treasury chief “shall furnish” the requested material to members of the Ways and Means Committee for them to examine behind closed doors.

A spokesman for Mnuchin didn’t immediately respond to requests for comment.

Mnuchin suggested in testimony to Congress last month that he would protect Trump’s privacy if the House Democrats requested his tax returns. “We will examine the request and we will follow the law … and we will protect the president as we would protect any taxpayer” regarding their right to privacy, Mnuchin said.

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