LETTER TO MR. RONALD K. PETERSON FROM LEE R. MARKS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP81M00980R000800010048-1
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 6
• Document Creation Date: December 19, 2016
• Document Release Date: August 17, 2005
• Sequence Number: 48
• Publication Date: June 15, 1978
• Content Type: LETTER

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DEPARTMENT OF STATE
Ww'h; U t .. `00
.June 15, 1978
Mr. Ronald K. Peterson
Chief, Resources-Defense-
International Branch
Office of Management and Budget
Room 7208, NEOB
726 Jackson Place, N.W.
Washington, D.C. 20503
This responds to David F. P. O'Connor's letter
to you, dated today, commenting for Treasury and
IRS on section 119(2) of S. 3076.
22 U.S.C. 52680a requires employees operating
in a foreign country to keep the U.S. ambassador
in that country "fully and currently informed"
of their activities. We believe this language is
sufficiently broad so that it would apply to
Internal Revenue Service agents conducting investi-
gations abroad, if it were not for the fact that
section 6103 of the Internal Revenue Code was
adopted subsequently.
Even though section 6103 is detailed, and
was enacted against the background set forth in
Mr. O'Connor's letter, we nonetheless believe that
enactment of section 119(2) of S. 3076 would pro-
vide authority for Internal Revenue Service agents
to brief chiefs of mission.
Our interest in the overseas activities of
Internal Revenue Service agents is limited to
activities that may be politically sensitive in
the host country and may thus have potential con-
sequences for the conduct of foreign relations.
Even with respect to politically sensitive cases,
it is unlikely that the Department would require
specific information of the kind that it would be
most troublesome for the Internal Revenue Service
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to disclose. Indeed, there is arguably sufficient
flexibility under the current law to permit at
least some disclosure of politically sensitive
information to ambassadors, but we believe that
enactment of section 119(2) is required to pro-
vide the full flexibility that both agencies need.
We would not want the Administration's atten-
tion to be focused exclusively on the IRS. There
may be other statutes, adopted in other contexts,
that place unintended limits on the ability of
U.S. employees operating abroad to keep our chiefs
of mission informed of their activities. _?nac-:7t-
ment of section 119(2) will insure that 22 U.~3.C.
?2680a is fully implemented.
To re-emphasize the point that we made at
Tuesday's meeting: the Department does not view
section 119(2) as affecting either the legal rela-
tionships between 22 U.S.C. ?2680a and the National
Security Act of 1947 or the practical working rela-
tionships that currently exist between chiefs of
mission and chiefs of station. We are concerned
with other agencies, not with our relations with
the CIA.
Kind regards.
S,incerely,
Lee R. Marks
Deputy Legal Adviser
Central Intelligence Agency
Office of Legislative Counsel
David F. P. O'Connor
Assistant to the Commissioner
Commissioner of Internal Revenue
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Was iingto r, DC 20224
JUii
5 1978
Mr. Ronald K. Peterson
Chief, Resources-Defense-
international Branch
Office of management and Budget
New Executive Office Building
726 Jackson Place, N.W.
Room 7203 i
Washington, DC 20503
Tom.. -
cr :_
Subject: Department of T easury/Internal
Revenue Servicef Comments on
Section 119(2) pf S. 3076 (State
Department Authorization Bill)
Dear Mr. Peterson:
Section 119(2) of the abo(-e referenced bill would
amend Section 16 of the State 7epartsnent organic act tc
provide that, notwithstanding Any other provision of law.
Chiefs of Mission be fully and, currently informed of al-
activities by employees of anyjagency within a 1.ereign
country. .)
The specific problem causd by this provision,
as it relates to Treasury/IRS;
tion to Section 6103(a) of th
specifically requires that re
(as defined in sections 6103(
fidential except as otherwise
of the Internal Revenue Code.
language of the supporting Co
generally about an ambassador
Moreover, the Committee repor
intent: in enacting section 16
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peratiQns, is its .app 1 is -
Internal Revenue Code, wh-.ch
rns and return informer tic:.
(1) and (2)) be kept f; on--
uthorized by other pra-,vis ions
rioth S. 3076 itself and the
ittee Report speak only
need for information.
makes clear that the
larify Congress' angina;
:.
n 1974. The provision ccot?s
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-_2 -
not deal directly with access to confidential tax return
information, which Congress `expressly saw fit to protect
with the enticement of Secti n 6103(a) of the Internal Revx*r,s:
Code. Congress enacted Sec ion 6103(a) in 1976, more that
two years after its enactee, t of section 16 of the State
Department organic act.
With this background, 4ie would not be inclined to
read the language of the cu rent bill or the supporting
Committee report as authori ing disclosure of tax informa-
tion. As administrators, or principal concern is assuring
that whatever rule is adopt !d in this area be made clear.
Both civil and criminal sanctions attach to unauthorized
disclosures of tax return information by employees of the
Internal Revenue Service ano other officials of government.
Section 6103(a) of the Internal Revenue Code requires dis-
closures of tax return info mation to be expressly authori:cd
in the Internal Revenue Cod` itself, and not in any other
statute. We believe that this approach should be followed
uniformly in order to assure that the rules authorizirg
disclosure are clear to our enforcement personnel.
We think it is also appropriate to note that the sub-
stance revision of Section X103 in 1976 was undertaken in
response to a clear Congres ional concern regarding the
extent to which tax returns and return information were
to be made available to oth-r agencies and departments of
government for nontax purposes. The enactment of Section
6103 represented a change ih the extent to which such data
would be cde available, anI the purposes and circumstanc.2.
of that availability. For ixample, the Attorney Genetal c,-tn
obtain access to most tax information for nontax purposes
only under a court order from a united States District Coirt
judge. Further, Presidential access to tax information
was severely limited in Section 6103(g) of the Internal
Revenue Code, which does not eliminate the President's
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i
Mr. Ronald K. Peterson
ability to obtain access to such information, but places
detailed restrictions upon the: circumstances and corrditi)}is
of that access. It seems anomalous to provide ambassad4 : 3
with access to the same information under circumstances
broader than those permitted for the President and the
Attorney General. This is a m*tter which deserves your
careful consideration.
With kind regards,
incerely,
Assi*tant to the Corrvissioner
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DEPARTMENT O'F STATE . S. A.
WASHINGTON. D. C. 20520
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