IRS plan to Catch Tax Dodgers Threatens Taxpayer Privacy
A proposal that would require banks to report annual cash flows for all clients is currently being considered by the House Ways and Means Committee and could wind up being added to Democrats’ $3.5 trillion spending bill, reports the Wall Street Journal.
The plan – which is backed by President Joe Biden, IRS Commissioner Charles Rettig, and Treasury Secretary Janet Yellen – would have the IRS looking at every bank account with a balance of more than $600. Such a meticulous review would encourage Americans to more accurately report income and could identify “opaque income streams that disproportionately accrue to the top,” said Yellen.
In a letter to lawmakers, a group of 41 industry leaders said the plan was “not remotely targeted” to reveal wealthy tax dodgers and could be used to expose the financial habits of political adversaries (like when the Dems tried to get Trump’s tax returns).
The plan also received pushback from 23 state treasurers and auditors, who signed a letter describing it as “one of the largest infringements of data privacy in our nation’s history.” Nebraska State Treasurer John Murante has already promised to fight the plan if it is signed into law.
Democrats’ proposal comes in addition to the $80 billion already allocated for the IRS to hire additional staff (a boost that is expected to produce an an additional $700 billion in revenue over the next 10 years) and Biden’s plan to heap taxes on wealthy Americans.
“What they’re saying is give us a ton of money, let’s hire a bunch of auditors and we think this will create revenue,” argues Rep. Kevin Brady (R-TX).
But the idea is far more insidious than that.
Democrats for years have been trying to infiltrate and influence our personal finances and this proposal could be utilized to control how Americans save and spend their money.
“Do you distrust the American people so much that you need to know when they bought a couch or a cow?” said Senator Cynthia Lummis (R-WY) to Secretary Yellen. “People literally will find alternatives to traditional banks just to thwart IRS access to their personal information not because they’re trying to hide anything, but because they’re not willing to share everything.”