Editor’s Note: Edward J. McCaffery is Robert C. Packard Trustee Chair in Law and a professor of law, economics and political science at the University of Southern California. He is the author of “Fair Not Flat: How to Make the Tax System Better and Simpler” and founder of the People’s Tax Page. The opinions expressed in this commentary are his own. View more opinion at CNN.
Can it really be time for yet another Donald Trump tax return story?
We’ve been down this road before. Many times. Remember 2016, during Trump’s first presidential run, when the man himself told us that we would see his returns “as soon as the audit was over.”? The audit never seemed to end, and an audit would not prohibit him from releasing the returns in any event.
Then there was the former Manhattan District Attorney, Cyrus Vance, who first subpoenaed Trump’s tax returns from the accountant Mazars in 2019, and actually got them years – and multiple legal cases – later.
The Trump tax return story du jour is the culmination of another years-long battle, this one with Congress. Since 2019, when Democrats took control of the House, the House Committee on Ways and Means Chair Richard Neal has attempted to get Trump’s returns under a statute that clearly gives him the power to do just that. No judge – not even Trevor N. McFadden, the lower court Trump appointee who delayed the matter and gratuitously suggested that Congress could, but should not, publish the returns – has ever disagreed. But “plausible legal arguments” have never been a necessity for Team Trump, and they managed to string things along for 1,329 days since the committee sought the former president’s tax returns, nearly as long as the American Civil War, as Congressman Bill Pascrell pointed out.
And so now, finally, the Supreme Court – without opinion or dissent – has denied Trump’s request to block the release of his tax returns.
So now what? Congress should get the returns within days, if they do not already have them. But the Democratic majority in the House has just a few weeks to do anything on their own. They could, legally, publish Trump’s returns. But this would seem hasty and vindictive, at a time when Democrats are hoping against hope to avoid hasty and vindictive investigations from the incoming Republican House.
Plus, there’s the fact that we already know what’s in the tax returns, more or less, and “we” haven’t much cared – taking “we” as the people who have little appetite for stories about how the rich and well-advised escape taxes, not being rich or well-advised themselves. The New York Times has been relentless in tracking down Trump’s tax information through journalistic means and published a detailed analysis of 20 years’ worth of the former president’s returns, showing that he paid little or no taxes in most years.
The Manhattan DA’s case has argued that the Trump Organization engaged in clear and rather obvious tax fraud, as by paying executives like Allen Weisselberg in untaxed, unreported forms, such as through private school tuition payments for his grandchildren. All of this is consistent with decades of Trump family aggressive tax avoidance, stretching back to the 45th president’s father, Fred, in the 1940s. The Trump Organization has routinely dismissed these allegations saying they are all part of a “witch hunt” by the Democrats.
But as John Koskinen, the Internal Revenue Service Commissioner under President Barack Obama, put it: “It’s not clear to me what you’re going to learn that you don’t already know when you look at these returns.”
Trump has, in a certain sense, “won” again, as his delays and protestations over the years, along with a slow drip of information mixed in with a heavy dose of misinformation have dulled us all into not caring much about his taxes, of all things. Chalk it all up to Trump tax fatigue.
But if nothing were done with Trump’s tax returns, it would be an opportunity lost. The whole saga cries out for reform. In arguing for access, the House Ways and Means Committee relied heavily on its roles in overseeing the executive branch’s administration of the tax laws and on its legislative responsibilities. Both are joined today, as there are – or should be – pressing questions about what the administrators are doing, and what new laws are needed.
For here is something that all Americans should be able to agree on: something is wrong with a system in which a billionaire president can pay no taxes. Either that’s not legal, and someone should be holding him or her to account, or it is legal and the laws should change. We have to better watch the watchdogs enforcing the present law, and we have to take a harder look at that law itself.
Since 1977, all presidential and vice presidential tax returns are subject to annual audits. What did these audits of Trump’s returns reveal? Was Team Trump pressed to defend all of their tax positions? Were adjustments made? Why or why not? What about earlier investigations into Trump and his family? Why hasn’t their rather clumsy tax planning –alleged fraud in the Weisselberg case – not been checked over the decades? Why did it take the Manhattan DA to find what the IRS did not? These are questions Congress should ask.
And if nothing untoward comes up in investigating the enforcement of our tax laws in Trump’s case, what does it tell us about the tax law itself that the rich can so easily avoid it?
In other words, maybe the lessons to be learned here are not about Trump, but about us, and our tax system. Maybe it’s time to get beyond Trump and whatever conspiratorial fantasies we hold about what smoking guns lie in his tax returns. We can transcend the petty, the past, the personal and look to a future that can be better for all of us. Trump’s tax returns provide a valuable and important case study for thinking about fixing the whole damn thing. We should use them thus.
Of course, don’t expect any of that to happen in six weeks, or after six weeks unless Republicans in the House cooperate in the mission, or unless the Senate can somehow take up the game. We are likely to be waiting for more than another Civil War’s duration before we see real change when it comes to taxing the rich – that’s a problem that predates Trump, and is apt to postdate him, and all of us, as well.
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