Business

/

ArcaMax

Michael Hiltzik: The IRS wanted a new tool to go after tax cheats. Republicans and bankers blocked it

Michael Hiltzik, Los Angeles Times on

Published in Business News

Here's a handy rule for anyone struggling to decode policy debates in Washington: If the GOP is throwing a fit about something, you can be sure their complaints are bogus.

Latest case in point: a provision in the Build Back Better bill, the Biden administration's omnibus spending package, that would give the Internal Revenue Service more of the information it needs to crack down on tax cheats.

The proposal would have required banks to report gross inflows and outflows in accounts with balances of more than $600 in a year and tighten reporting from online selling platforms such as Etsy and EBay.

As depicted by congressional Republicans and their peanut gallery of right-wing commentators, the proposal would empower legions of gimlet-eyed IRS agents to poke their snouts into even your tiniest financial transactions.

Here's House Minority Leader Kevin McCarthy (R-Bakersfield): "Democrats want to spy on anything you earn or buy that is more than $600. By hiring 85,000 new IRS agents to dig through every aspect of your life the Democrats want to enlist a bureaucratic army to achieve their goal of a big-government socialist nation."

Senate Minority Leader Mitch McConnell (R-Ky.): "Washington liberals want to let the IRS leaf through Americans' checking accounts as if everyone were a potential criminal or terrorist until proven otherwise. The IRS already knows how much you earn. Now they want to know exactly how you spend it."

 

Right-wing pundit Candace Owens: "The Biden administration is attempting to empower the IRS to monitor every single withdrawal, deposit, and transaction you make from your personal banking accounts, PayPal, Venmo, etc."

Not a single one of these assertions is true.

Nevertheless, congressional Democrats are bailing on the proposal. They're considering changing the threshold for reporting to $10,000, which would give tax cheats sizable headroom to hide income. The proposal would also exempt inflows such as those from direct-deposited wages.

Even that doesn't satisfy the banking industry, which like all industries has never met a regulation it couldn't describe as the end of civilization as we know it.

...continued

swipe to next page
©2021 Los Angeles Times. Visit at latimes.com. Distributed by Tribune Content Agency, LLC.