New York State

New York will get Trump’s tax returns

Last week, the state Senate passed a bill that would allow Congress to access President Donald Trump’s state tax returns, and New York state is much more likely than congressional Democrats to beat Trump in court, writes law professor Scott Lemieux.

New York state is much more likely than congressional Democrats to beat Trump in court.

New York state is much more likely than congressional Democrats to beat Trump in court. Evan El-Amin/Shutterstock

The refusal by President Donald Trump to comply with legitimate congressional requests for documents and testimony has produced what House Judiciary Committee Chairman Jerrold Nadler accurately referred to as a “constitutional crisis.” Whether Congress will be able to get the courts to force the Trump administration to comply with some or all of their subpoenas is an open question. But it has a new ally: the state of New York.

Last week, the state Senate voted in favor of legislation that if it is passed by the Assembly and signed by Gov. Andrew Cuomo would allow Congress, as part of its oversight responsibility, to access some of Trump’s hidden tax information.

And New York state is much more likely than congressional Democrats to beat Trump in court. The most important provisions of the bill would allow the state Department of Taxation and Finance to release tax returns for a wide array of state and federal public officials (including the president) to three congressional committees, as long as the request is for a “specified and legitimate legislative purpose.” The bill is in response to a particularly egregious piece of stonewalling by the Trump administration: Treasury Secretary Steven Mnuchin refusing to comply with a demand from the House Ways and Means Committee to release Trump’s tax returns from 2013 to 2018. Mnuchin’s refusal comes despite clear language in a statute passed in the wake of the Teapot Dome scandal in 1924 requiring the returns to be turned over after a request from the committee.

Trump’s New York tax returns would not, of course, contain all of the information contained in his federal tax returns. But since Trump and most of his businesses are based in New York, there would be a great deal of overlap. And given the staggering and unprecedented conflicts of interest involved with Trump and the business empire he continues to be associated with, the returns are likely to reveal information that is of major public interest and substantially damaging to Trump – which, of course, is precisely why he’s trying to hide them.

Given the fact that federal law also authorizes the release of Trump’s tax returns to Congress, however, merely passing the law doesn’t guarantee that the returns will be released. Mnuchin is refusing to release the returns on the basis that the request by Congress lacks a “legitimate legislative purpose.” Unlike Mnuchin, the Cuomo administration will be surely be willing to comply with a congressional request for the New York tax information, but the Trump administration would presumably sue to prevent the state tax department from releasing the returns, arguing that there is no legitimate purpose to knowing about the president’s business ties to foreign interests. But the administration would have to make these arguments in a much less favorable judicial context, as it would be hashed out in New York state courts.

The argument that the requests for Trump’s tax information lack a legitimate purpose, given Congress’ constitutional oversight function, can be characterized as being somewhere between “weak” and “farcical.” The kind of corruption made possible by the entwining of Trump’s business interests and his administration is exactly the kind of corruption the 1924 law was intended to thwart. The U.S. Supreme Court upheld the use of this subpoena power in 1975 when it was being used by a conservative senator to bankrupt groups that opposed the Vietnam War – to put it mildly, a less legitimate legislative purpose than examining Trump’s potential conflicts of interest. In light of this precedent, Trump’s battle to keep his returns from being released has a chance of succeeding only because the Supreme Court is currently controlled by partisan Republicans.

If Congress requests New York’s returns, however, Trump’s legal position is even weaker. It is one thing to not require an administrative official to comply with a legislative demand he considers inappropriate; to argue that New York cannot comply with a request would be an even heavier lift. And New York state courts, which aren’t nearly as favorable to Republican arguments, are charged with interpreting state laws.

The only realistic hope Trump would have is finding a partisan federal court that might come up with a strained argument to try to stop the release of the state returns. But, since that would burden states’ rights, it is much less likely to succeed.

The remedies offered by this bill would be incomplete, but they do offer some leverage to members of Congress who are actually trying to hold the Trump administration accountable for its historic malfeasance.