By Richard Rubin
WASHINGTON -- Treasury Secretary Steven Mnuchin said he expects a federal judge to resolve the dispute over congressional access to President Trump's tax returns, and he signaled that he and IRS Commissioner Charles Rettig will defy subpoenas demanding the documents.
"We haven't made a decision but I think you can guess which way we're leaning on our subpoena," said Mr. Mnuchin, who has contended that lawmakers lack a legitimate legislative purpose to receive Mr. Trump's tax returns.
Mr. Mnuchin and Mr. Rettig testified Wednesday at a hearing of the Senate subcommittee overseeing the Treasury and Internal Revenue Service budgets.
"This is why there are three branches of government," Mr. Mnuchin said. "This will go to the third branch of government to be resolved."
Rep. Richard Neal (D., Mass.), chairman of the House Ways and Means Committee, has requested six years -- 2013 through 2018 -- of Mr. Trump's business and personal tax returns along with audit records. Mr. Neal invoked a 1924 statute that lets the chairmen of the tax-writing committees obtain any taxpayer's returns.
That statute says the Treasury secretary "shall furnish" such information, but Mr. Mnuchin has tied his refusal to constitutional limits on congressional investigations.
Last week, after being rebuffed by Mr. Mnuchin, Mr. Neal issued subpoenas to Messrs. Mnuchin and Rettig for the documents and set a deadline of this Friday, May 17.
Mr. Neal has said lawmakers want to see how well the IRS is auditing the president, under a policy that requires presidents and vice presidents to be audited each year.
"Wouldn't you agree that Congress has an interest in verifying that the IRS is fairly enforcing the law and making sure that the president... is paying the taxes he owes," said Sen. Chris Van Hollen (D., Md.) at Wednesday's hearing.
During the 2016 campaign, Mr. Trump broke a decadeslong tradition of voluntary disclosure of tax returns. He has also referred to tax avoidance as sport and tied his refusal to continuous audits. No law prevents him from releasing returns while under audit.
In response to questions from Mr. Van Hollen (D., Md.), Mr. Mnuchin couldn't say whether the automatic audits include a president's business dealings.
As with the audit of any business owner, the audits of a president may include a review of any businesses owned by the president, Mr. Rettig said.
"The depth of examination of a particular entity would depend on the judgment or skill of the examiners," he said.
Mr. Mnuchin has offered a more detailed briefing to lawmakers on those questions.
Mr. Mnuchin also said on Wednesday that Mr. Rettig and IRS Chief Counsel Michael Desmond agree with the decision not to hand over the tax returns to Mr. Neal. Mr. Mnuchin has said he relied on legal advice from the Justice Department, which hasn't yet published its formal opinion.
"I have not had any discussions with the president or taken any direction from him or anybody else in the White House on this issue," Mr. Mnuchin said.
Mr. Trump has made repeated public comments about his refusal to publicize his tax returns.
Write to Richard Rubin at email@example.com
(END) Dow Jones Newswires
May 15, 2019 12:33 ET (16:33 GMT)
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