Court Battles

Trump sues lawmakers, NY officials to thwart potential release of state tax returns

President Trump on Tuesday sued the Democratic-controlled House Ways and Means Committee, the New York state attorney general and a New York state tax official to try to block any potential efforts by lawmakers to obtain his state tax returns.

The president filed the lawsuit in federal court in Washington, D.C., alleging that House Ways and Means Committee Chairman Richard Neal (D-Mass.) is considering using a recently passed New York state law to try to get Trump’s state tax returns.

“Because the Committee’s jurisdiction is limited to federal taxes, no legislation could possibly result from a request for the President’s state tax returns. The Committee thus lacks a legitimate legislative purpose for using the TRUST Act,” the lawsuit states.

{mosads}This lawsuit comes on the heels of a separate complaint filed by the Ways and Means Committee seeking Trump’s federal tax returns.

Trump is asking that a federal judge issue permanent injunctions blocking House Democrats from requesting his tax returns under the law, stopping the New York attorney general from enforcing the law and preventing the New York tax and finance commissioner from providing lawmakers with the tax documents.

New York Attorney General Letitia James expressed confidence that Trump’s effort would fail.

“President Trump has spent his career hiding behind lawsuits, but, as New York’s chief law enforcement officer, I can assure him that no one is above the law — not even the president of the United States,” she said in a statement.

“The TRUST Act will shine a light on the president’s finances and finally offer transparency to millions of Americans yearning to know the truth,” her statement said “We have all the confidence that this law is legal and we will vigorously defend it against any court challenge.”

Neal has said that the House general counsel is “reviewing” the New York law, but has not gone much further in his public statements. He’s indicated that his lawyers have concerns about whether the New York law is applicable.

When asked about the lawsuit Tuesday, Neal said, “our interest has been in the federal taxes.”

“I think that we sensed that something like this would be coming, but we continue to do our work methodically, as we indicated always that we would,” he said.

He said he’s still making a decision about what to do when it comes to Trump’s state tax returns.

“The House counsel has been trying to figure it out. He’s gone back and forth on it,” Neal said.

Under the state law — signed by New York Gov. Andrew Cuomo (D) earlier this month — the chairmen of the House Ways and Means Committee, as well as the leaders of the Senate Finance Committee and the Joint Committee on Taxation, can request officials’ tax returns from the commissioner of the New York Department of Taxation and Finance.

While Neal has led the charge to get Trump’s federal tax returns, he has indicated that he’s less willing to get the state documents, saying that they’re not as relevant to his committee’s efforts as the federal documents.

His committee is investigating whether current IRS procedures for auditing presidents meet a high enough standard, and has said that lawmakers are also examining whether they should pass legislation on this topic.

That purpose is at the heart of House Democrats’ federal lawsuit seeking Trump’s federal tax returns.

However, Trump’s attorneys attempted to paint a picture of a much more imminent threat to the president in Tuesday’s lawsuit.

They claim that recent reports indicate that Democratic lawmakers could be close to requesting those state tax returns “at any time, with no notice to the President. And New York could respond to the request nearly instantaneously, mooting the President’s ability to object before his tax records are disclosed.”

“President Trump was thus forced to bring this lawsuit to safeguard his legal rights,” the complaint states.

The lawsuit in particular cites a NBC News report published Monday, which suggests that progressives are frustrated by Neal not taking advantage of the law.

Trump also argues that the New York law — the TRUST Act — violates the First Amendment because it targets him specifically.

The law “singles out President Trump because he is a Republican and a political opponent,” the lawsuit alleges. “It was enacted to retaliate against the President because of his policy positions, his political beliefs, and his protected speech, including the positions he took during the 2016 campaign.”

New York state assemblyman David Buchwald (D), who sponsored the TRUST Act, said he thinks Trump’s lawsuit won’t be successful.  

“I have every confidence that the President’s legal challenge will fail and New York’s standing offer to support Congress in its oversight role on taxes will remain in effect,” Buchwald said in a statement. “It’s no surprise that the President has moved quickly in an attempt to strike down New York’s tax transparency law as he is fighting the release of his tax returns on every front.”

State Sen. Brad Hoylman (D), who sponsored the bill in that chamber, said that Trump’s lawsuit lacks merit. 

“It impugns the integrity of the legislative purpose behind the law. New York State has an interest in supporting the lawful oversight responsibilities of the U.S. Congress,” he said in a statement.

Ryan Thomas — spokesman for Stand Up America, one of the progressive groups who supports the New York law — said that the lawsuit shouldn’t dissuade Neal from requesting Trump’s state tax returns.

“Chairman Neal should use every tool at his disposal to get answers on behalf of the public and hold Trump accountable — and that includes the TRUST Act,” Thomas said. “Trump’s brazen attempt to bury the truth should not stop Chairman Neal from doing his job.”

Trump bucked decades of precedent when he declined to release his tax returns during the course of his 2016 presidential campaign. He has repeatedly stated that he is being audited and therefore cannot make the documents public – an assertion disputed by the IRS.

Neal and his committee in April had requested six years of Trump’s federal personal and business tax returns from the IRS, under a provision in the federal tax code that says the Treasury Secretary “shall furnish” tax returns requested by the chairmen of Congress’s tax committees.

But Treasury Secretary Steven Mnuchin rejected the request, saying it lacked a legitimate legislative purpose. And the Cabinet member similarly shot down subpoenas issued by Neal seeking the tax returns.

It was those rejections that sparked Neal’s lawsuit for Trump’s federal tax returns.

This is the third time that Trump has gone to court to challenge House Democrats seeking his financial records. However, the first two lawsuits took issue with congressional subpoenas for the president’s records, whereas this complaint appears to center on the potential for state tax returns to end up in lawmakers’ hands.

This story was updated at 6:25 p.m.

Tags Donald Trump Richard Neal Steven Mnuchin Tax returns Trump state tax returns

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