Treasury Department rejects Dem subpoena for Trump tax returns

Treasury Secretary Steven MnuchinSteven Terner MnuchinMnuchin: Trump's 'as determined as ever' on China trade fight Sunday shows preview: Trump ratchets up trade war with China The Hill's Morning Report: How will Trump be received at G-7? MORE on Friday defied a subpoena from House Democrats for President TrumpDonald John TrumpGraham: America must 'accept the pain that comes in standing up to China' Weld 'thrilled' more Republicans are challenging Trump New data challenges Trump's economic narrative MORE's tax returns, a move that's likely to trigger a court battle for the documents.

“We are unable to provide the requested information in response to the Committee’s subpoena,” Mnuchin said in a letter to House Ways and Means Committee Chairman Richard NealRichard Edmund NealDemocrats push judge for quick action on Trump tax returns lawsuit Trump argues NY tax return case should take place in DC NY files motion to keep Trump tax returns lawsuit out of DC court MORE (D-Mass.).

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Mnuchin reiterated in the letter that Treasury has determined that Neal's request "lacks a legitimate legislative purpose."

Both Mnuchin and Neal have said they think the dispute will be decided in the courts. Neal told reporters hours before Mnuchin sent his letter that Democrats “will likely proceed to court as quickly as next week."

In a statement issued after Mnuchin rejected the subpoena, Neal said he is "consulting with counsel on how best to enforce the subpoenas moving forward.”

Neal last week issued subpoenas for six years of Trump's personal and business tax returns — 2013 to 2018 — after Mnuchin rejected the chairman’s request for the documents under a statute that states that the Treasury Secretary “shall furnish” tax returns requested by the chairpeople of congress’s tax-writing committees, so long as information associated with any specific taxpayers is reviewed in a closed session.

Mnuchin and IRS Commissioner Charles Rettig had been given a deadline of 5 p.m. on Friday to produce the tax returns sought in the subpoenas.

Neal said in Friday's statement that the subpoenas should not have been needed in the first place because Treasury should have complied with his earlier requests.
 
"The law provides clear statutory authority for the Chair of the Ways and Means Committee to request and receive access to tax returns and return information," he said. "The law, by its terms, does not allow for discretion as to whether to comply with a request for tax returns and return information."

Democrats argue that the documents are needed for a legitimate legislative purpose.

Neal stated in his initial request for the tax returns that the Ways and Means Committee is conducting oversight and is considering legislative proposals relating to how the IRS audits presidents. But Mnuchin argued in a previous letter that Democrats’ main goal is to expose a political rival’s tax returns.

In his letter Friday, Mnuchin said that Treasury remains committed to providing the Ways and Means Committee with more information about the IRS's process for conducting mandatory audits of presidents.

Some Democrats and liberal groups want Congress take action to hold Mnuchin in contempt while also pursuing legal action in the courts.

“It is unconscionable for our country to have a Treasury Secretary who repeatedly shows us that he will continue to obstruct justice at every turn in order to do Trump’s bidding. Neither Mnuchin nor Donald Trump is above the law," Tax March Executive Director Maura Quint said in a statement after Mnuchin announced he was defying the subpoena.

Rep. Lloyd DoggettLloyd Alton DoggettHere are the 95 Democrats who voted to support impeachment Speaker Pelosi, seize the moment to make history on drug pricing House Democrats sue Treasury to turn over Trump tax returns MORE (D-Texas), a senior member of the Ways and Means Committee, said in a statement Friday that "Congress shrinks its own power if it does not deploy its most credible remedy—inherent contempt.”

If Congress uses its inherent contempt powers, it could detain or fine administration officials who don't comply with their subpoenas.

But Neal told reporters Friday that he sees legal action as preferable to taking steps like a contempt vote.

"I think that the better option for us is to proceed with a court case," he said.

--Updated at 5:21 p.m.