Should States Force Candidates to Disclose Tax Returns?

A U.S. Individual Income Tax Return form. President Donald Trump and congressional Republicans have unveiled a long-awaited outline of their tax reform plan for individuals and corporations—but one big thing was left out: how to pay for it. Shannon Stapleton/reuters

This article first appeared on the Justice site.

Last week, a few lawmakers in California went public with plans to introduce legislation in Sacramento that seeks to prevent presidential candidates who fail to disclose tax returns for the five most recent years prior to the election from having their names appear on the state's November ballot in 2020 and beyond.

The effort is patterned on a similar proposal being pushed by some legislators in New York state. The proposal there, dubbed the Tax Returns Uniformly Made Public (or TRUMP) Act, requires each presidential candidate to disclose tax returns prior to 50 days before the November election, or else the candidate's name will not appear on the ballot and the state's electors will be prohibited by state law from casting their votes for the candidate in the so-called Electoral College.

Access to a candidate's tax return information prior to an election makes it possible to evaluate whether there are possible conflicts of interest, the levels and directions of charitable giving, candidates' relative aggressiveness in seeking to minimize tax burdens, and so forth. Many voters, and certainly many journalists, were disappointed that Mr. Trump had departed from modern tradition in declining to produce his returns. While state legislative proposals like the TRUMP Act plan to ensure candidate disclosure in the future, they also raise a number of legal and policy issue questions, some of which I will address below.

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Do States Have Legal Authority to Mandate Tax Return Disclosure?

Certainly a big threshold question is if states have the legal authority to impose such a requirement on presidential candidates as a condition for his or her name to appear on the ballot, or for a candidate's eligibility to be voted on by the state's Electoral College contingent.

The New York Times published an editorial earlier this month expressing its belief—and quoting leading constitutional scholar Larry Tribe of Harvard—that laws like the ones being discussed in New York and California should be upheld in court.

To be sure, there are arguments in favor of state authority, since states have broad leeway to regulate so-called "ballot access," but there are also arguments on the other side that this view is dicey. (The Times quote from Professor Tribe did not indicate anything more than a state "might be able" to impose the kinds of tax-return-disclosure requirements currently being considered.)

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Putting aside the question of the independence of electors who have been selected (an independence about which I have my doubts), one possible line of constitutional attack against TRUMP Act–like laws is based on a 1983 Supreme Court case, Anderson v. Celebrezze, in which the Court struck down an Ohio law requiring any independent (i.e., non-major-party) presidential candidate to file a statement of candidacy and a nominating petition with state election officials by March 20 for eligible inclusion on the November ballot.

Related: Neil Buchanan: Did Trump's Tax Dodge Break the Law?

The Court weighed the state's interest in having an early- filing deadline against the associational interests of independent candidates and their supporters—especially in the context of a national election, where a state's actions can influence a national outcome. As the Court observed:

[I]n the context of a Presidential election, state-imposed restrictions implicate a uniquely important national interest. For the President and the Vice President of the United States are the only elected officials who represent all the voters in the Nation.

Moreover, the impact of the votes cast in each State is affected by the votes cast for the various candidates in other States. Thus, in a Presidential election, a State's enforcement of more stringent ballot access requirements, including filing deadlines, has an impact beyond its own borders.

It bears noting, however, that 17 years after Anderson v. Celebrezze, the Court decided Bush v. Gore, in which several justices seemed to recognize a much broader authority of states to administer the presidential-selection process.

Some of the justices seemed to indicate that states didn't even need to hold elections to gather popular input before selecting representatives to the so-called Electoral College, and that as long as states were not treating votes from different parts of the state or for different candidates in a disuniform way (and a tax-return-disclosure requirement would apply equally to all candidates and their supporters), states would continue to have broad latitude.

The short of it is that the Supreme Court, were it to weigh in on the validity of TRUMP Act–type laws, could go in a variety of different directions.

A second line of attack might be premised on U.S. Term Limits, Inc. v. Thornton, a 1995 case in which the Court struck down a state law preventing congressional candidates who had already served a certain number of terms in Congress from appearing on congressional election ballots in the state, holding that states had no authority to impose additional requirements beyond those mentioned in the Constitution for the office of U.S. representative or senator, and that preventing the names of long-serving federal legislators from appearing on the ballot amounted to an additional requirement for congressional office-holding.

The same kind of argument might be made about the TRUMP Act.

But here, too, things are not so simple. Popular elections for members of the House and Senate are constitutionally required, but perhaps not so for the offices of the president and vice president. For this reason, states may have much less leeway to regulate congressional elections than they do presidential-selection procedures.

Should States Enact Such Laws?

Moving beyond legal validity, are laws like the TRUMP Act a good idea? That too, depends. If only blue states like New York and California adopt such laws, then only Democratic candidates will have meaningful pressure on them to disclose their tax returns.

To be blunt, nothing in the 2016 presidential election would have changed if the name Donald Trump—or those electors pledged or inclined to support him—had not appeared on the California or New York November ballots. And that fact was known from the onset of the election cycle.

So, as with so many presidential election reforms, for this one to have any beneficial real-world effect, it would have to be embraced by either a mix of blue and red states, or at least a number of swing states where neither party can feel assured of a victory.

And ballot access regulations like the TRUMP Act could themselves complicate other well-intentioned and viable reform efforts, such as the National Popular Vote (NPV) plan, which I have written a great deal about on this website and within the academic community.

For any effort by a group of states to collectively allocate their electors to the national popular vote winner (regardless of who got more votes within each of the signatory states) to work, we need some reliable way of discerning voter preferences in all 50 states (and D.C.), so that the nominal national popular vote winner is indeed the choice of the greatest number of American voters.

But if voters in some states are effectively prevented from registering their preferences because of something like the TRUMP Act, then the title of national popular vote winner is deprived of much of its democratic legitimacy.

For example, imagine if Mr. Trump's name did not appear on the New York and California ballots in 2020, and that he was beaten in the national popular vote tally by a relatively narrow margin; surely no one could think he meaningfully "lost" the national popular vote, since he no doubt would have received several millions of votes in California and New York, even though he was likely to lose those states had he been on the ballots there.

I wrote an article in a 2011 Georgetown Law Journal which stated that if enough states adopt the National Popular Vote plan, such states might begin allocating electors according to the plan, and Congress would then have the power to adopt a law providing for more national uniformity in discerning a meaningful national vote tally.

Proposals like the TRUMP Act convince me all the more of the importance of federal legislation if and when states making up 270 or more electors sign onto the NPV plan.

Vikram David Amar is the Iwan Foundation professor of law and the dean at the University of Illinois College of Law.

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