It is now one week into the Obama administration, and the healing is supposed to have begun, and he is bringing us change that we can believe in. I think I remember a campaign promise about bringing a new level of ethics to Washington, DC. One hopes he doesn’t bring it in from Chicago.
We now officially have a Treasury Secretary, Timothy Geithner, who is a tax evader. When an audit discovered that he had not paid taxes on income from the IMF for 2003 and 2004, he somehow didn’t consider that he had made the exact same error for 2001 and 2002. Conveniently, the statue of limitations had expired for those years.
Yes, the IRS reports to him, even though he only coughed up the last of his $43,000 of unpaid taxes just before he was nominated. He’ll also be the guy who signs your dollar bills.
We know that Democrats are opposed to rich guys who don’t pay their fair share of taxes. That is why only 95% of the Democrats in the Senate voted for him. Here are comments from the 3 Democrats who voted against him.
I believe Mr. Geithner when he expresses regret for his failure to pay these taxes, but that doesn’t explain why the failure happened. This embarrassing “mistake” occurred despite Mr. Geithner receiving annual and quarterly documents from the IMF and signing annual tax allowance requests that were supposed to serve as reminders about his tax obligations. He also failed to pay these taxes despite having accountants review his tax filings, and despite using software to prepare his tax returns. He only paid these taxes in full after being selected to be Treasury Secretary….Whatever his qualifications and talents for addressing the banking problems that are plaguing our economy, I cannot in good conscience vote to confirm this nomination.
He has stated this was an innocent mistake and that there was no intent to deliberately avoid paying the required taxes. However, the IMF informs us that in order to avoid exactly this kind of situation, its U.S. citizen employees are fully informed of their obligation to pay Social Security and Medicare taxes and must sign a form acknowledging that they understand this obligation.
Moreover, the IMF gives its U.S. citizen employees quarterly wage statements that detail their U.S. tax liabilities. The IMF pays its U.S. citizen employees an amount equal to the employer’s half of the payroll taxes with the expectation that the individual will use that money to pay the IRS.
So a serious question is raised as to how a person of Mr. Geithner’s financial sophistication could run the gauntlet of these many warnings and quarterly reminders and still somehow innocently overlook his obligation to pay these payroll taxes…Given this record of failing to pay taxes, if confirmed as Treasury Secretary, how could Mr. Geithner speak with any credibility or authority as the Nation’s chief tax enforcer? Would his admonition be: Do as I say, not as I do? That is not acceptable.
I am deeply troubled by his failure to pay the payroll taxes he owed, despite repeated alerts from his employer at the time, the International Monetary Fund, that he was responsible for paying those taxes. It is especially troubling because Mr. Geithner signed documents at the IMF promising to pay taxes, including the payroll taxes, in exchange for a special “gross-up” of his income intended to offset the cost of those taxes. Moreover, his earlier interactions with the Internal Revenue Service over his failure to pay sufficient payroll taxes for his household employees make Mr. Geithner’s explanations of his failure to pay his own payroll taxes even less satisfactory.
The failure to comply with our Nation’s tax laws would be problematic for any Cabinet nominee, but it is especially disturbing when it involves the individual who will be charged with overseeing the enforcement of our tax laws. Mr. President, surely that individual must meet a higher standard than a failure to establish they deliberately evaded their tax liability.
Apparently, 25% of Republicans also think it is OK to have a tax evader as Secretary of the Treasury, since 10 Republicans voted to confirm him too. They may have hoped that he is the lesser of possible evils, or they may think that someone who didn’t pay all of his taxes might not be credible when it comes time to push for tax increases (as Democrats always will.)