Incoming House Ways & Means Committee Chair Richard Neal (D-MA) indicated that he will request President Trump’s tax returns soon after Democrats formally take control of the House in January. Trump already has said he will try to block their release. In this matter, Neal is right. He not only has the authority to see the president’s tax returns, such a step is appropriate and necessary, as part of our checks and balances. The Constitution calls upon the House, along with the Senate, both to enact legislation and to oversee whether those laws are faithfully executed. To fulfill its oversight responsibility, I believe the House should demand the President’s tax returns.
The House effectively delegates its oversight responsibilities to its committees which can issue subpoenas for documents or testimony from the executive branch. In the matter of tax returns, the law could not be more clear (see Code sec. 6103(f)): Upon written request by either the Chairman of either the Ways and Means Committee or the Senate Finance Committee, the Treasury Secretary “shall furnish such committee with any return or return information specified in such request.” The Committee may share these tax returns and related information with the full House, assuming there is a legitimate purpose for doing so.
Congress gave itself the right to review any return or return information in 1924, in the aftermath of two controversies. One was the Teapot Dome scandal, where senior officials in the Harding Administration granted public oil field leases in exchange for bribes. The other involved allegations that Treasury Secretary Andrew Mellon continued to own many business interests while serving in government. Some believed the Bureau of Internal Revenue, the precursor to the IRS, showed favoritism to the secretary and his businesses.
The parallels to President Trump are striking. Trump maintains a sprawling business empire, which he refuses to transfer to a blind trust. According to multiple published reports, the president, through his businesses, derives income from foreign governments and their lobbyists, which also may violate the Constitution’s prohibition against emoluments. The president reportedly intervened personally to block the FBI from moving its headquarters and thus opening up for commercial development a site just a few blocks from his downtown Washington hotel. The president reportedly paid little or no tax for many years, in part because of aggressive tax planning and, perhaps, tax evasion. And throughout his campaign and since his election, the President acknowledged that he has been under audit.
These multiple allegations raise legitimate questions about whether the president is running the government for his benefit or the public’s—or both. Is he profiting from his position? Is the public harmed? Is the IRS auditing the president’s returns appropriately—and without favoritism? Has the IRS proposed any adjustments—and has the president paid them?
To fulfill its oversight responsibility, Congress, through the Chairman of the Ways and Means Committee, should demand the president’s personal and business tax returns that were open for audit at the time he assumed office and the 2017 returns filed since his election. Neal also should request any audit records for these returns, the work papers of any audit, and any written determinations.
For nearly the past half-century, such congressional demands for presidential tax returns have been unnecessary. In 1974, President Nixon voluntarily released his tax returns to quiet the public clamor over his reportedly low taxes. He also invited the Congressional Joint Committee on Taxation to audit his tax returns after the IRS reportedly gave him a pass (and JCT determined he owed an additional $476,431 in back taxes and interest). In the years since, every President until Donald Trump voluntarily released his returns to the public and permitted them to be automatically audited by the IRS. As Nixon famously explained: “People have got to know whether or not their president is a crook.”
Nixon was right.
