Why Republicans Are Attacking IRS Funding In Biden’s Inflation Reduction Act

by | Sep 2, 2022 | Politics

There is one particular provision of the Inflation Reduction Act, President Joe Biden’s $369 billion investment in health care and climate change prevention, that has sent Republican lawmakers into a spasm. They believe, falsely, that the law will allow the IRS to hire 87,000 new revenue agents to go after ordinary taxpayers. “They’re coming for YOU too,” Sen. Ted Cruz (R-Texas) tweeted in early August. Sen. Ron Johnson (R-Wis.) wrote, “Who do you think they’ll weaponize the 87,000 IRS agents against? The answer is obvious. Their political enemies.” AdvertisementThe IRS funding is quickly becoming a stand-in for any type of perceived government overreach, to a ludicrous extent. “After todays raid on Mar A Lago what do you think the left plans to use those 87,000 new IRS agents for?” Sen. Marco Rubio (R-Fla.) tweeted last month. While the Inflation Reduction Act does include $78 billion over 10 years for the IRS, that money is mainly to help the agency backfill thousands of existing positions, such as IT people, taxpayer customer support —and, yes, auditors. But they will primarily be assigned to focus on ultrawealthy Americans and corporate tax cheats. Those positions have gone empty largely because of Republican efforts to choke off funding to the IRS. Since 2010, when the GOP recaptured the House, Republicans have succeeded in cutting enforcement funding by double digits and bringing down audit rates of large corporations and superrich individuals to historic lows.Republicans are eager to keep it that way since the party relies utterly on the wealthiest individuals to fund their election efforts. Rich political donors favor the GOP by nearly any measure: A majority of the country’s largest donors support Republicans; megadonors make up an outsized share of Republican fundraising; the overall donor class is richer and more conservative than the average American. If the IRS were to step up enforcement against tax evasion among the wealthiest individuals, it would more than likely target Republicans’ biggest benefactors.AdvertisementAs it happens, the Department of Justice recently charged one of those donors with perpetrating the largest known tax fraud scheme in U.S. history. Robert Brockman, who died in August, was a software billionaire who was accused of constructing a web of offshore companies over a period of 14 years in order to hide more than $2 billion from tax collectors. Over the years, Brockman has also showered Republican election efforts with large donations, including $100,000 to former House Speaker Paul Ryan’s political committees, and $1 million to super PACs supporting then-presidential candidate Mitt Romney.Brockman’s tax evasion tactic was relatively simple. A new report from the Senate Finance Committee attributes his success in hiding billions of dollars less to his ingenuity and more to the IRS’s severe lack of enforcement capability. His scheme involved getting around the Foreign Account Tax Compliance Act, or FATCA, a 2010 law that requires global banks to report the assets of their U.S. clients to the IRS. Congress passed the legislation to make it more difficult for Americans to hide taxable wealth abroad. But Brockman got around the law by hiding his money in foreign shell compani …

Article Attribution | Read More at Article Source

Share This