The Senate Finance Committee has approved Timothy Geithner as the next Treasury secretary despite concerns over his taxes.
Geithner underwent a grilling before the committee on Wednesday over his taxes and his involvement with the controversial Troubled Assets Relief Program (see Geithner Quizzed on TARP and Taxes). After the hearing, Geithner went on to answer a 102-page questionnaire from committee Chairman Max Baucus, D-Mont. The committee voted 18-5 to approve Geithner on Thursday, despite a no vote from ranking member Charles Grassley, R-Iowa. The full Senate is expected to vote to confirm Geithner on Friday.
"During yesterday's confirmation hearing, Mr. Geithner gave answers to committee member questions about his tax compliance problems," said Grassley in a statement. "The nominee's answers to the committee and during the vetting process give me pause. The explanations for irregularities have ranged from statements that he should have known, to proclamations that if only his accountants had warned him he would have done the right thing. I received a message yesterday from a constituent in Dubuque expressing concern about this nomination. The constituent wrote, 'If the man cannot handle his own finances, how is he going to handle the country's?'"
However, Grassley pledged to work with Geithner if he is confirmed by the full Senate.
Besides dealing with his own taxes, Geithner said in the questionnaire that he would also deal with the problem of foreign tax havens. "Yes, Senator Baucus, as soon as my tax team is fully in place, I look forward to setting aside time to review your forthcoming legislation and helping you, your staff and other members of the Senate develop a solution to the problem of offshore tax evasion," he wrote. "If confirmed, I will treat offshore tax evasion as a high-priority issue and examine a wide range of policy options to address these abuses, including increasing IRS enforcement efforts, requiring greater disclosure and taxpayer accountability, and changing the presumption for transactions in tax-secrecy jurisdictions."
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