The fight over Donald Trump’s taxes

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Donald Trump

Supreme Court ruling wins the president time in row over his financial records

In Depth

Joe Evans

Tuesday, November 19, 2019 – 2:23pm

President Donald Trump will not be forced to hand over his tax returns this week, after the US Supreme Court put on hold plans to allow a House of Representatives subpoena requesting information about his finances.

The highest court in the US has put the subpoena on “indefinite hold” in the latest development in a long-running dispute over the president’s tax returns, which critics say must be released in the name of transparency.

How did the tax returns battle originate?

Trump ignored nearly half a century’s tradition when he refused to release his tax returns during his 2016 campaign for the White House.

The move caused widespread condemnation, as well as launching a number of theories about why he would want to keep the information so close to his chest.

These theories were bolstered when, in October 2018, it was revealed in that New York authorities were investigating claims that the president took part in “dubious” tax schemes. There is currently another separate pending request from Trump to block a subpoena from a New York prosecutor for his tax returns.

Earlier this year, during his explosive testimony in front of Congress, ex-Trump lawyer Michael Cohen added fuel to the fire when he labelled Trump “a cheat”, and claimed that the president had engaged in efforts to reduce his real estate tax burden by artificially inflating and deflating his assests. At the time, Trump accused Cohen of lying.

Why do people want Trump’s tax returns?

Those pushing for the release of Trump’s tax returns say it is crucial to establish whether there is any conflict of interest between Trump’s official duties as president and his multiple business dealings.

Cohen’s testimony led Lily Batchelder, a professor at the New York University School of Law, to write in The New York Times that “there is ample reason to fear that conflicts of interest have infected [Trump’s] approach to tax policy”.

The newspaper found, in a separate investigation in October 2018, that Trump recieved “at least $413 million in today’s dollars from his father’s real estate empire, much of it through tax dodges in the 1990s”.

A spokesperson for Trump said at the time: “The president’s father gave him an initial $1 million loan, which he paid back. President Trump used this money to build an incredibly successful company as well as net worth of over $10 billion, including owning some of the world’s greatest real estate.”

But Democrats are “concerned with the president’s compliance with federal tax laws”, The Guardian says, “as well as whether he or his family personally benefited from the tax overhaul passed by Republicans and signed by Trump in 2017”.

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Why has the Supreme Court blocked the release?

Last week, a federal appeals court ruled against the president when it said that the House of Representatives’ subpoena demanding Trump’s tax returns could be enforced.

CNN reports that after the ruling “Trump’s personal lawyers rushed to the Supreme Court” in an attempt to give Trump more time to appeal the ruling.

Essentially, the Supreme Court has now ruled that the House of Representatives – which is controlled by the Democrats – cannot receive any records for 14 days after a request for the president’s tax returns. This will give the court’s justices time to decide whether the House of Representatives’ subpoena request is lawful.

The court has not blocked the release for ever, but the ruling has bought the president more time.

Time magazine notes that the delay “could last a matter of days or weeks” if the Supreme Court is willing to allow the federal appeals court decision to remain in place without a full review of the case. However, the magazine also adds that should the court decide that a full review is necessary, “the delay could extend for months”.

What happens next?

The House of Representatives has to wait, at least until the Supreme Court makes its final decision on whether the subpoena will be allowed to stand.

Both sides now must file the necessary paperwork with the Supreme Court, so that the justices can decide whether to take up the case.

Trump has so far lost the case for keeping his tax returns secret at every level of the American judicial system, but, as The Independent says, if the Supreme Court takes up this case “the result could be a high profile showdown between Democrats and Mr Trump”.

Also, with impeachment proceedings rumbling on in the background, the newspaper adds: “The case has been interpreted as a test to see how successful Mr Trump may be in resisting subpoenas issued by House Democrats as a part of their impeachment probe.” 

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