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WASHINGTON – Democrats, eager to control a powerful House tax drafting committee next year, are studying a century-old provision of the federal tax code that could give them access to long-awaited tax returns sought by President Trump and the US. possibly allow to make them public.
The powers enumerated in an obscure addition to the Tax Code in the 1920s are clear: the leaders of the congressional tax drafting committees, including the Ways and Means Committee, are empowered to petition the Treasury Department for income tax returns. related information declaring tax. Democrats could use this information to finally determine whether Mr. Trump, who built a global business empire before going into politics, has financial problems with Russia or other undisclosed conflicts of interest.
They could also use such an investigation to determine if Mr. Trump had broken the law before his election to avoid paying taxes.
How would they do it? A law of teapot Dome
The law, which goes back to the Warren G. Harding Administration's dome scandal, seems to leave little room for the Trump administration to resist such a demand; he simply says that the treasury secretary "must" provide the requested information.
But the Democrats expect Trump and his Treasury officials to refuse to abide by it, trying a lawsuit in the House and guaranteeing a long court battle over the legitimacy of Congressional control over Chief Executive.
Mr. Trump's lawyer, Rudolph W. Giuliani, said in a brief interview on Tuesday that he would advise Trump to oppose any such request and has reason to believe he could to win. With the control of the House, he said, the Democrats would only conduct a "circus" and would probably have a hard time proving that they had a legitimate goal of legislation or oversight.
"It's really for political harassment," Giuliani said, adding, "It's a great battle for a president."
Democrats have publicly committed to moving forward if they get control of the House after the November election. Representative Nancy Pelosi of California, the Democratic leader, told the San Francisco Chronicle last week that the public saw itself "duty" of transparency given Trump's refusal to disclose his tax returns, a violation of modern presidential norms.
"This is one of the first things we would do – it's the easiest thing in the world," she said.
Could he turn around politically?
But, aware of the party's prospects in 2020 and the short-term suffering inflicted on Trump, party leaders are divided over the speed and aggression of their actions. Some party members fear that if they fail in advance to develop adequate public justification, Mr. Trump would describe the majority as a blatant abuse of his authority, undermining democratic efforts to provide a stable alternative to Republicans.
The President almost seems to dare the Democrats to act. Mr. Trump wrote on Twitter on Tuesday that he had "no financial interest in Saudi Arabia (or Russia). Any suggestion I make would be just more fake news.
In a 2015 campaign speech, however, he praised the "hundreds of millions" of dollars that he earned with the Saudis.
To complicate matters further, the Democrats are preparing a series of investigations by many committees to take control of them. They must determine how to prioritize filing cabinets unresolved requests for documents and investigative leads on issues such as election interference in Russia, foreign government profits for presidential affairs, allegations of Cabinet corruption and hurricane relief.
"You should not rush into this business," said New Jersey representative Bill Pascrell Jr., a Democrat on the Ways and Means Committee that pushed Democrats to tackle the problem of taxation. "I do not think you're here to bury anyone. You are here to find the facts.
Massachusetts Attorney Richard E. Neal's lawyers, who are supposed to lead the Ways and Means Committee if the Democrats win it, have begun to refer to Trump's tax inquiries. as being "the nuclear option" and felt that they would have little chance of accessing any tax information next year even if they act immediately.
Tax law experts do not agree on how effectively Mr. Trump could challenge the House's right to statements.
The precedents, from Warren Harding to Richard Nixon
The provision – Article 6103 of the Tax Code – dates from the early 1920s, when Congress was plunged into investigations into bribes allegedly paid to Harding administration officials by officials. citizens looking for leases of federal lands containing rich oil reserves. Lawmakers were led to ask the president to disclose tax information on officials accused of wrongdoing and claimed that to maintain the separation of powers and serve as a control to the executive, they needed to Authority to obtain tax returns themselves.
"The whole debate was not that different from today's," said George K. Yin, a professor of tax law at the University of Virginia.
In the decades that followed, the authority was hardly used. In 1974, a committee used it to supplement tax information provided by President Richard M. Nixon to determine whether he had adopted inappropriate tax positions and then to publish a bipartite report of nearly 1,000 pages on his conclusions.
In 2014, Republicans of the Committee of Ways and Means used it to obtain and publicly disclose tax information in the course of an investigation into if the I.R.S. discriminated against conservative entities wishing to benefit from a tax exemption status. The Democrats denounced it as a political smear that abused the committee's authority.
Andy Grewal, a law professor at the University of Iowa, said that Democrats could risk similar accusations and expose a legal defense to the president if they did not bother to set a goal. Legislative Legislation for an Application.
"I did not think that at the time of writing this law, they thought it would be used to settle accounts between the White House and a newly elected Democratic majority," Grewal said.
Mr. Grewal cited two Supreme Court decisions – Watkins v. United States in 1957 and Kilbourn c. Thompson in 1880 – which limit congressional control powers if legislators have no legitimate purpose. Mr. Yin, who advocates the use of the law in the case of Mr. Trump, sees little reason why the House could not triumph.
What we know about Trump's tax record
The details of only two of Mr. Trump's personal tax returns have been made public. The New York Times reported in October 2016 that Mr. Trump reported a loss of $ 916 million in his 1995 tax return, a loss so large that he could have legally avoided paying anything in federal income tax for 18 years. And in March 2017, Rachel Maddow revealed in her MSNBC show two pages of Mr. Trump's 2005 statement, showing that he had earned $ 150 million and paid $ 38 million in federal income taxes. .
A Times investigation released this month revealed that Trump misled the public about some aspects of his estate and could give Democrats an extra reason to search for documents. Although Mr. Trump repeatedly reiterated that his business empire was based on a "small loan" from his million-dollar father – repaid with interest – the Times found that he was in reality received at least the equivalent of $ 413 million real estate empire. The investigation also revealed that Mr. Trump and his family had resorted to questionable schemes to minimize the tax burden of this legacy, including outright fraud. Mr Trump criticized the conclusions but did not flatly deny them.
In the minority, Democrats have already invoked the provision 17 times to demand the president's tax returns, to be blocked by the Republican majority. Republicans have already begun to assert that Democrats risked setting a dangerous precedent by seeking out confidential tax information from an alleged political opponent.
The ability to request information about taxpayers is a "powerful monitoring tool to use not for political fishing expeditions, but to properly administer the tax code," Texas Representative Brad Brady told the President. from Ways and Means.
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