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As the Trump<\/span> administration vows to crack down on leakers, Republicans in Congress want to hand the Justice Department even more power to punish one extremely specific type of leak: unauthorized disclosures of tax records, which in recent years have exposed the creative accounting of the Trump family<\/a> and wealthy allies like Elon Musk<\/a>.<\/p>\n A provision tucked near the end of the GOP\u2019s massive budget bill \u2014 at page 1,081 of the 1,082-page text circulated<\/a> late Sunday \u2014 would double the maximum prison sentence for leaking tax returns to 10 years and increase possible fines from $5,000 to $250,000 per violation.<\/p>\n Boosting penalties for leakers may seem an odd fit for a budget bill, much like the \u201cnonprofit killer\u201d provision <\/a>that was recently nixed <\/a>without explanation. Because of their tenuous relationship to fiscal matters, the provisions potentially aren\u2019t allowed under the rules for Congress\u2019s budget reconciliation process.<\/p>\n Just don\u2019t ask the main proponent of increasing the penalties for tax return leaks, Republican Rep. Jason Smith of Missouri, if these provisions were appropriate to include.<\/p>\n \u201cWish I could be helpful, but that\u2019s a question for the Senate parliamentarian,\u201d replied Smith\u2019s communications director, J.P. Freire, by email.<\/p>\n <\/p>\n <\/p>\n Last session, Smith sponsored a stand-alone bill<\/a> with identical proposed changes to the tax code that passed the House of Representatives last year but failed to advance in the Senate. Smith is one of President Donald Trump\u2019s main surrogates<\/a> on Capitol Hill for the budget bill and is also chair of the House Ways and Means Committee, which included his proposal about tax record leaks in its section of the budget bill.<\/p>\n Critics wonder whether increasing prison sentences for journalists\u2019 sources is the best use of legislators\u2019 time.<\/p>\n<\/blockquote>\n<\/figure>\n Critics wonder whether increasing prison sentences for journalists\u2019 sources is the best use of legislators\u2019 time as the White House works with House Republicans to push the budget toward the Senate. The proposal would also increase criminal penalties for those who \u201cprint or publish in any manner\u201d leaked tax return information, although prosecutors looking to go after journalists and outlets directly would face constitutional hurdles under the Supreme Court\u2019s First Amendment precedent<\/a>.<\/p>\n \u201cOf course, tax information is highly sensitive and there are legitimate reasons to protect financial privacy,\u201d wrote Seth Stern, director of advocacy for the Freedom of the Press Foundation, in an email. \u201cBut there are also times when it\u2019s highly newsworthy \u2014 for example, when a president keeps secrets about his finances and business dealings abroad, or when powerful politicians and billionaires evade taxation.\u201d<\/p>\n \u201cThere is no need to drastically heighten existing penalties, which, as far as I know, have been largely effective deterrents aside from cases where whistleblowers felt compelled by their consciences to expose impropriety.\u201d<\/p>\n Republicans\u2019 fixation on<\/span> tax return leaks focuses on one person: Charles Littlejohn<\/a>, who pleaded guilty<\/a> in January 2024 to leaking Trump\u2019s tax returns to the New York Times<\/a> and a cache of tax return data for thousands of wealthy individuals to ProPublica<\/a>.<\/p>\n In its report<\/a> advancing Smith\u2019s bill last summer, the Ways and Means Committee made Littlejohn the main character and Trump a pitiful victim. During Littlejohn\u2019s trial, Republican members of the committee wrote<\/a> to the federal judge to demand that he spend five years in prison, the maximum under the current statute<\/a>, instead of 10 months as recommended by the federal sentencing guidelines.<\/p>\n Judge Ana Reyes, a Biden nominee, did as Republicans suggested and sentenced<\/a> Littlejohn to the five-year maximum, which he is currently appealing.<\/p>\n But for many Republicans, Littlejohn got off too easy. \u00a0<\/p>\n \u201cGiven the lack of deterrence created by the law as is, as well as the concern that such an unprecedented data breach could result in such a disproportionate charge and sentence, the Committee felt it was necessary to increase the penalties,\u201d reads the committee report about Smith\u2019s bill.<\/p>\n But 10 years is the kind of prison sentence beyond that given to many people convicted of crimes, like possessing child sexual abuse material and certain firearms offenses, said Christopher A. Wellborn, president of the National Association of Criminal Defense Lawyers.<\/p>\n \u201cDo we really need to have imprisonment for up to 10 years on something like this?\u201d Wellborn asked.<\/p>\n \u201cLawmakers and judges should focus on stopping tax evasion by the rich and powerful.\u201d<\/p>\n<\/blockquote>\n<\/figure>\n During his sentencing, Littlejohn\u2019s attorneys argued<\/a> that he leaked the tax return data \u201cout of a deep, moral belief that the American people had a right to know the information and sharing it was the only way to effect change.\u201d But just like<\/a> the Espionage Act<\/a>, the tax code\u2019s leak provisions have no public interest defense<\/a>.<\/p>\n \u201cLeakers\u2019 motives, and whether their disclosures serve the public good, should at least be a mitigating factor,\u201d Stern said. \u201cWhistleblowers should not be treated the same as malicious actors. Lawmakers and judges should focus on stopping tax evasion by the rich and powerful, not on disproportionate punishments for whistleblowers who expose how existing law is failing Americans.\u201d\u00a0<\/p>\n The proposals to<\/span> stiffen penalties for tax return leakers are part of Republicans\u2019 budget bill, which is currently advancing through the reconciliation mechanism. Under the so-called \u201cByrd rule,\u201d named for the late Sen. Robert Byrd of West Virginia, matters that are \u201cextraneous\u201d to the budget and fiscal matters cannot be enacted<\/a> via reconciliation.<\/p>\n Earlier this month, the leaker provision was scored as having \u201cnegligible\u201d impact on revenue by the Joint Committee on Taxation<\/a>.<\/p>\n \u201cThat will hurt Republicans\u2019 arguments\u201d under the Byrd rule, predicted Bobby Kogan, senior director for federal budget policy at the Center for American Progress, who has studied reconciliation<\/a> and the Byrd rule, which is applied by the Senate\u2019s parliamentarian. \u00a0<\/p>\n In 2021, for example, the parliamentarian nixed Democrats\u2019 attempt<\/a> to increase the federal minimum wage in a reconciliation bill, ruling that any impact of the change on the federal budget was \u201cmerely incidental\u201d to the underlying policy intent, which violates the Byrd rule.<\/p>\n <\/p>\n\n
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