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Obama’s tax audit strategy

Wednesday, June 5th, 2013

By Dick Morris
The Hill

Did the Internal Revenue Service scandal begin when the Obama administration aggressively tried to deny tax-exempt status to pro-Israeli groups that funded settlements on the West Bank in defiance of its wishes? The IRS seems to have used tax audits to try to cripple these Jewish groups. When the Citizens United decision came down, did President Obama turn the guns focused on the conservative Jewish groups to fire on Republican political organizations?

The Washington Free Beacon reports that the idea of using the IRS to undermine settlement activity surfaced barely two months after Obama took office.

On March 26, 2009, The Washington Post questioned the tax-exempt status of pro-settlement Jewish groups.

The next day, the American-Arab Anti-Discrimination Committee (ADC), which has enjoyed warm relations with the president, asked the IRS to investigate groups “allegedly raising funds for the development of illegal settlements in the occupied West Bank.”

Meanwhile, Arab pressure to audit the settlement groups escalated. In October 2009, a cable revealed by WikiLeaks recounted a meeting between the chief negotiator for the former Palestinian Prime Minister Ahmed Qurei and U.S. Consul General Daniel Rubinstein. The cable noted that Qurei gave Rubinstein “a copy of an article … in Israeli daily Haaretz newspaper on August 17, entitled ‘American Non-profit Organization Raises Funds for Settlement’ and asked the US to review the situation with an eye toward eliminating organizations’ tax exempt status if they are funding settlement activity.”

The Free Beacon notes that the following week, J Street, a pro-Palestinian lobbying group, also demanded an investigation into U.S. charities that contribute to settlements.

HaYovel, a group that sends volunteers to work in West Bank vineyards, was the first to be audited, six months after its role was prominently featured in a New York Times article. The Times quoted a senior State Department administration official calling such groups “a problem” and “unhelpful to the efforts that we’re trying to make.” It was the first of many Jewish pro-settlement groups to experience IRS audits.

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