Hatch Weighs In on Tax Status of ‘Super PACs’
Senator Orrin Hatch, Republican of Utah, joined the fight over the tax status of “Super PACS” on Friday, accusing Senate Democrats of a “politically motivated witch hunt” for their efforts to rein in tax-exempt political groups.
Mr. Hatch, the ranking Republican on the Senate Finance Committee, was responding to a letter by seven Senate Democrats demanding that the Internal Revenue Service establish a clearer test limiting the politicking of 501(c)(4) groups like American Crossroads, a Republican group, and Priorities USA, a Democratic outfit. The letter, which still has not been sent, also requests stronger rules preventing corporate donors from deducting Super PAC contributions from their taxes, and it threatens legislative action if the I.R.S. fails to act.
“Unfortunately, this request from the other side of the aisle puts the IRS in an untenable and unacceptable situation for what I hope are not political ends,” Mr. Hatch wrote in a statement released Friday. “It’s pretty hard not to draw that conclusion since the White House and its congressional allies are talking out of both sides of their mouths by accepting unprecedented sums of big labor and rich liberal money. I also find the timing somewhat suspect – we never heard a peep from the other side in previous election cycles when they were reaping the benefits of these types of organizations.”
The tug-of-war on Super PACS – with the I.R.S. in the middle – may be burgeoning into an election-year fight over campaign finance regulations. Two campaign finance watchdog groups, Democracy 21 and the Campaign Legal Center, dashed off their own letter to the I.R.S. on Friday asking that it ignore complaints from conservatives about inquiries into the activities of Tea Party groups and Super PACS.
“We strongly urge the IRS not to succumb to such arguments, or to any public or political pressure to back away from carrying out the agency’s statutory responsibilities to enforce the tax laws,” the groups wrote.
On Monday a coalition of liberal interest groups and union leaders will launch a pressure campaign against companies funding political nonprofits.
Mr. Hatch called such efforts hypocritical, pursued more because Democrats are losing the money race than because of campaign finance ideals.
“Sending the IRS on a politically motivated witch hunt is simply unacceptable and could have a chilling impact on the constitutionally-protected right to free speech,” he wrote. “I expect the IRS not to succumb to this type of political posturing.”