Mnuchin rejects Democrats’ subpoena for President Trump’s tax returns

WASHINGTON – Treasury Secretary Steven Mnuchin on Friday rejected a subpoena from House Democrats demanding copies of President Trump’s tax returns, setting the stage for a court battle over the documents.

Mnuchin said the House Ways and Means Committee’s request “lacks a legitimate legislative purpose,” citing the legal advice of the Department of Justice, and said he was not authorized to hand over the returns.

“We are unable to provide the requested information in response to the Committee’s subpoena,” Mnuchin wrote.

Last week, Committee Chair Richard Neal, D-Mass., issued subpoenas that gave Mnuchin and Internal Revenue Service Commissioner Charles Rettig until Friday at 5 p.m. to turn over Trump’s financial records. House Democrats have expressed confidence the law requires the IRS to permit them to access the document, a position supported by numerous legal experts.

The denial is expected to be one of the last steps before a federal court fight over Trump’s financial records, the source of significant speculation since Trump refused to release them during the 2016 presidential campaign in a break with decades of precedent.

Neal is likely to sue the administration in federal court to enforce the subpoenas, and Mnuchin told a Senate panel he was glad the judiciary would be responsible for mediating the dispute between Congress and the administration.

“A lawsuit is the next step. There’s no negotiation here,” said Steve Rosenthal, an expert at the Tax Policy Center, a non-partisan think-tank.

The expected court battle is part of the broader clash between House Democrats and the White House over a range of oversight issues, as Democrats on the intelligence and judiciary committees have pushed for many documents, particularly related to the special counsel investigation, that the Trump administration has refused to release.

Mnuchin and congressional Republicans have cited concerns over taxpayer privacy in denying the request, accusing Democrats of seeking to “weaponize” the IRS.

“This has a very big impact on every single taxpayer,” Mnuchin said. “This will go to the third branch of government to be resolved.”

Rep. Bill Pascrell, D-N.J., a member of the House Ways and Means Committee, suggested in an interview that Mnuchin may be subject to a fine, a contempt vote, or even possibly jail time for ignoring what he said was the clear intent of the law.

“I would throw the book at these guys,” Pascrell said. “We don’t have a kingdom, regardless of the imagination of some public officials … you deserve the full weight of the law. Let’s not play games anymore.”

Neal first demanded six years of Trump’s personal and business returns, from 2013 to 2018, in letters to the administration last month.

Neal’s subpoenas demanded that for these years Mnuchin and Rettig turn over Trump’s individual income tax returns, all “administrative files” such as affidavits for those income tax returns, and income tax returns for a number of Trump’s business holdings such as the Donald J. Trump Revocable Trust, an umbrella entity that controls dozens of other businesses including the Mar-a-Lago Club in Florida.

The Washington Post’s JM Rieger contributed reporting to this story.