Tom Daschle offered a public apology on Monday evening for his failure to pay income taxes on use of a luxury car and driver, and Senate Democrats rallied behind him, saying they intended to win his confirmation as secretary of health and human services.
Following a closed-door meeting with the Senate Finance Committee, Daschle, the former majority leader of the Senate, said his failure to pay more than $140,000 for which he was liable was “completely inadvertent.”
“But that’s no excuse,” said Daschle, who looked somewhat sheepish as he was surrounded by Democratic senators he led until being defeated in 2004. “I deeply apologize to President Obama, to my colleagues and to the American people.”
At the same time, it became clear on Monday that Daschle was responsible for thousands of dollars in additional unpaid taxes related to his use of the car service, even after paying more back income taxes and interest. He has acknowledged that he owes Medicare taxes equal to 2.9 percent of the personal value of the car service he received from Leo Hindery Jr., a big Democratic donor and founder of a private equity firm to which Daschle was an adviser.
Daschle’s failure to pay Medicare taxes on the income was discovered by the Finance Committee. The amount of the unpaid Medicare tax has not been disclosed. But in his amended returns, filed on Jan. 2, Daschle estimated that the value of the car service was equivalent to income totaling $255,256 in the years from 2005 to 2007.
Despite the tax issue, the chairman of the Finance Committee, Sen. Max Baucus, D-Mont., scheduled a formal confirmation hearing for next Tuesday and said he would support the nomination.
Other Democrats on the panel said that the tax error, while embarrassing, was understandable because Daschle had not been provided a 1099 Internal Revenue Service form showing the car as income.
“I will support the nomination of Tom Daschle in the committee and on the floor with a great deal of vigor,” said Sen. John D. Rockefeller IV, D-W.Va.
But Republicans said they remained troubled by the nomination. Sen. John Ensign, R-Nev., who sits on the panel, said he believed that the Daschle tax problems merited much more scrutiny and that the tax mistakes admitted by an earlier Obama administration nominee, Treasury Secretary Timothy F. Geithner, “seem more plausible.”