Committee Chairman Richard Neal has been in a pitched battle with the administration for weeks, finally issuing a subpoena to Treasury and the IRS in May after the agencies rebuffed the Democrat’s request for six years of the President’s personal and business tax returns.
Neal has invoked a little-known provision of the tax code that states the Treasury secretary “shall furnish” the committee with the return information, and he has claimed
that returns are needed to consider legislative proposals related to federal tax laws and the IRS’s practice of auditing sitting presidents.
The Office of Legal Counsel at the Justice Department acknowledged Neal’s authority and that the plain text of the tax code does not require the committee to provide any purpose in support of its request for tax information. However — pointing to a number of public statements from Neal and attempts from other Democrats to force the release of the tax returns — OLC concluded that Neal’s proffered oversight justification was merely “pretextual,” and the “real reason” for requesting the returns was to make them public.
“(The) Committee’s stated purpose . . . blinks reality. It’s pretextual. No one could reasonably believe that the Committee seeks six years of President Trump’s tax returns because of a newly discovered interest in legislating on the presidential-audit process,” Engel wrote. “Recognizing that the Committee may not pursue exposure for exposure’s sake, however, the Committee has devised an alternative reason for the request.”
As a result, OLC concluded that the Treasury secretary had an affirmative duty not to disclose the taxes given that disclosing that taxpayer information is generally prohibited.
“Where, as here, there is reason to doubt the Committee’s asserted legislative purpose, Treasury may examine the objective fit between that purpose and the information sought, as well as any other evidence that may bear upon the Committee’s true objective,” Engel added — an argument similarly echoed by Mnuchin last month when he defied the subpoena
as lacking a legitimate legislative purpose.
CNN has reached out to Neal’s office for comment. Treasury spokeswoman Monica Crowley referred questions to the Justice Department.
Neal has not yet made any moves to enforce the subpoenas, but Friday’s OLC opinion outlines the arguments the administration would likely use if the battle moves to federal court.
Mnuchin testified last month
that he has not discussed the issue with Trump and told lawmakers: “I have been advised I am not violating the law. I would have never done anything to violate the law. Quite the contrary, I was advised had I turned them over I would be violating the law.”
The Washington Post reported
the day before his testimony that a confidential IRS draft memo last fall determined that the tax returns must be surrendered to Congress unless the President opts to invoke executive privilege.
Mnuchin said at the hearing that he had not discussed the memo prior to the Post’s story, but the memo addressed a “different issue” than the one he and the Justice Department looked at.
This story has been updated with additional developments Friday.