Trump Wins Round One In Battle Over His Tax Returns

-edited

In a round one victory for Trump, the US Supreme Court suspended a House subpoena regarding Trump’s finances.

The Wall Street Journal reports Supreme Court Suspends House Subpoena Seeking Trump’s Financial Information.

The Supreme Court granted President Trump’s emergency request to suspend enforcement of a congressional subpoena seeking his financial records from his accounting firm, a move that could keep the documents from House Democrats for months—if they see them at all.

But in tandem with blocking the subpoena for now, the court signaled Mr. Trump would have to move quickly with his appeal, ensuring the president can’t delay proceedings through the 2020 election.

One of Two Things

  1. At least five justices found that the appeal had a likelihood of success on the merits and the appellant would experience irreparable harm if the state was not granted. Those five justices, and possibly more, may be favorably disposed to reversing the lower court decision.
  2. It might just mean that five members of the court Wanted to have sufficient time to carefully consider this, which they think is an important issue.

Nothing Decided Yet

All we can say at this point is that nothing is decided. But this was a at least a temporary victory for Trump. The court could have left the lower court ruling stand.

Heart of the Legal Battle

A Yale University blog on Administrative Law & Regulatory Practice asks Can Congress Get President Trump’s Tax Returns?

The article was written in 2017 so the second paragraph excerpted below is completely inaccurate, but the rest discusses the legal merits in general.

The statutory authority for any congressional requests would probably come from Sections 6103(f)(1) & (2) of the tax code. Under (f)(1), some committees of Congress can request disclosure of Trump’s returns and can examine those returns privately. Under (f)(2), a non-partisan career official, the Chief of Staff of the Joint Committee on Taxation (JCT), may also request and privately examine those returns.

As a political matter, these proposals are a long shot, whatever their independent merits. Republicans control congressional committees and probably won’t request President Trump’s tax returns or publicly disclose them. And though the JCT Chief of Staff is nonpartisan and can request Trump’s tax returns, he cannot independently disclose those returns. Only the full JCT, controlled by Republicans, can do so.

Even if a congressional committee requests President Trump’s tax returns from the IRS, President Trump may have a constitutional defense to disclosure. That is, although Section 6103(f) is phrased in absolute terms — it allows tax committees and the JCT Chief of Staff to obtain tax return information, without qualification — any congressional action, including requests for information, must come within the scope of legislative powers granted by Article I of the Constitution. And a request for President Trump’s tax returns, if made for purely political purposes, may exceed legislative powers. (Update: For my full length law review article on the subject, see here: The President’s Tax Returns).

As the Supreme Court explained in Watkins v. United States, “there is no congressional power to expose for the sake of exposure.” Rather, if Congress wants to collect information from the executive branch or other outsiders, it must do so in connection with its legislative power. That is, a Congressional attempt to investigate an official or request information from him is valid only to the extent it serves proper legislative purposes. Congress cannot simply engage in “a fruitless investigation into the personal affairs of individuals.” Kilbourn v. Thompson, 103 U.S. 168, 195 (1880). Thus, for example, it seems unlikely that Congress could properly request the tax returns of all civil rights leaders solely for the purpose of harassing them, even if there were potential non-discriminatory reasons for making those requests.

However, as President Trump has himself found out through litigation involving his immigration order, public comments can sometimes backfire. The many intemperate public comments that Democratic legislators have made about Trump’s tax returns could taint any request they make for them. That is, if the power balance shifts in Congress and a Democrat-controlled tax committee requests the President’s tax returns, President Trump may be able to properly disregard that request, if he correctly believes that the request is supported only by personal animus and not a proper “legislative purpose.” See Watkins v. United States, 354 U.S. 178, 200 (1957).

The Issues

There is no congressional power to expose for the sake of exposure. Thus, if Trump can persuade the court this is a political witch hunt, the Supreme Court will toss the lawsuit on those grounds.

The court might decide in favor of Trump anyway, for other reasons.

On the other hand, there is an ongoing impeachment investigation in which Trump's finance could apply. But then again, the request for his returns pre-dates the impeachment investigation.

Finally, did Trump again manage to say something in public comments that could backfire? That is always a possibility.

In conclusion, there are a huge number of reasons the Supreme Court might have wanted to hear the case, not just rubber stamp a victory from Trump.

But, the fact the Supreme Court will the case at all is a good thing for Trump and a bad thing for the Democrats, at least compared to the alternative.

Mike "Mish" Shedlock

Comments (23)
No. 1-14
Sechel
Sechel

Trump won nothing. Everything I read suggested this was going to the Supreme Court. Still think Trump will lose here.

RonJ
RonJ

California lost its bid to keep Trump off the primary ballot.

hmk
hmk

I always wondered why he is refusing to release his returns. He offers no reasonable explanation.

FromBrussels
FromBrussels

the sore losing Democrats bunch has been shooting itself in the foot big time, that much is obvious....

shamrock
shamrock

I wouldn't call this round 1, he has lost every single lower court ruling. He's looking for a knock out punch in the last round of the fight.

Wmjack50
Wmjack50

Its obvious the elite Democratic swamp dwellers are merely spending our tax money exploring any avenue to over through a President that is not part of the swamp. At least Trump has exposed the corruption in DC and the media. Ex: Biden kickback of foreign aid to son Hunter

Casual_Observer
Casual_Observer

The issue is if our leaders are corruptable via their personal businesses, then it is an issue for all levels of government. If there is some landmark ruling that Trump must release his tax returns based being a public servant, then look for him to retaliate by asking every congressional member and senator and presidential candidate to release their returns. Trump is going to do what Trump does best - drag others down into the dirt and fight.

Zardoz
Zardoz

For somebody with nothing to hide, he’s trying really hard to hide it.

Rvrider
Rvrider

Political theater— red meat morsels for the respective base’s. The Dems have lost the occasional vote from this independent. Now it’s the repubicrats to lose my occasional vote for them.

AshH
AshH

It may show that he's not nearly as rich as he brags about. Or that he pays very little in taxes. Or that his major source of income is not in running businesses, but in licensing his name. Just speculating here.

WildBull
WildBull

Nobody's damn business

Irondoor
Irondoor

Simple answer: Trump was elected without releasing his tax returns. The majority of voters in enough states apparently didn’t care. Leading up to the next election, he will probably again “promise” to release them if he exhausts all appeals to the courts. Of course, he still has the “under IRS audit” excuse available.

TCW
TCW

Is the IRS not capable of determining if he has broken any tax laws? Why can't political hacks let the IRS do it's job?