Republican-Led House of Representatives Plans to Try to Cut Off IRS Funding
House Republicans' first legislative action will be an attempt to eliminate billions of dollars in funding for the agency that Democrats approved the previous year to assist in cracking down on tax evaders.
Conservative legislators in the House of Representatives want to derail President Biden's $80 billion revamp of the IRS, so they plan to propose cutting Internal Revenue Service funding as one of their first legislative acts.
The bill, which may be brought to the floor of the House as early as Monday evening, lacks the support of either the Senate's Democratic majority or President Joe Biden.
But the bill is the first shot fired by the new Republican majority, which aims to pull back the legislative gains made by Democrats during their two years in control of Congress and the White House.
In a policy statement confirming Mr. Biden's veto, the administration called the legislation "a reckless bill" that showed the new majority's "top economic priority is to allow the rich and multibillion-dollar corporations to skip out on their taxes while making life harder for ordinary, middle-class families that pay the taxes they owe."
After years of GOP accusations that the IRS unjustly targeted conservative organizations and harassed small companies and middle-class people, the GOP has turned its attention to the agency.
After securing the position of chairman of the influential House Ways and Means Committee on Monday, Representative Jason Smith of Missouri, who is from the state of Missouri, said of the measure, "We are not stopping there." In a statement, he added that Mr. Biden's nominee to serve as the next commissioner of the Internal Revenue Service, Daniel Werfel, should "plan to spend a lot of time before our committee answering questions about the leaking of sensitive taxpayer information and an agency with a history of targeting conservative Americans." Werfel is being nominated for the position by Mr. Biden.
Kevin McCarthy of California reaffirmed his commitment to have the defunding of the Internal Revenue Service the first item passed by the Republican majority shortly after he was elected as the next speaker of the House of Representatives early on Saturday morning.
He said that the government's role should be to assist citizens, not to persecute them.
Despite opposition from Republicans, Democrats included an additional $80 billion in funding for the Internal Revenue Service in the Inflation Reduction Act passed the previous year. They claimed that this would assist the agency in its efforts to crack down on tax evaders and ensure that the government was collecting the taxes owed. The money will be used to recruit 87,000 additional personnel for the Internal Revenue Service and to upgrade the outmoded technological systems utilized by the agency. Over ten years, it is anticipated that the investment would result in an income of $180 billion.
However, Republicans, who have spent months criticizing the federal budget deficit and calling for increased fiscal responsibility, have dismissed any possibility of a revenue gain and instead made the false accusation that the administration is attempting to create a "shadow army" to shake down small businesses with assault rifles.
The Republican measure to remove funding for the Internal Revenue Service would raise the deficit by $114 billion through 2032, according to the impartial Congressional Budget Office, which released its findings on Monday.
On Twitter, J.P. Freire, a spokesperson for Republicans serving on the House Ways and Means Committee, said that the revenue predictions would need an increase in the number of audits conducted on taxpayers belonging to the middle class. He said that the agency often audited people even though such taxpayers did not owe any more money to the government.
Mr. Freire indicated that increasing the number of audits would be difficult and uncomfortable.
The Ways and Means Committee recently produced findings that highlighted the impact of years of neglect and Republican cutbacks to the budget of the Internal Revenue Service. These studies were published with former President Donald J. Trump's tax returns. The intention is to put the money into an organization that has seen its resources dwindle over time.
The administration of President Joe Biden has pledged to make it a top priority to use the extra cash to enhance customer service at the Internal Revenue Service, making it simpler for taxpayers to receive answers to their problems. In addition, it has guaranteed that there will be no increase in the number of audits conducted on taxpayers whose annual income is less than $400,000.
According to a statement made by Ashley Schapitl, a spokeswoman for the Treasury Department, "the legislation proposed by House Republicans would make it possible for wealthy individuals and corporations that evade taxes to continue doing so, thereby increasing the burden on honest, hardworking families who pay their taxes with every paycheck." "The Internal Revenue Service audits over eighty percent fewer millionaires than it did a decade ago, and this measure would deprive the agency of much-needed funding to attract top expertise to go after the one percent's yearly tax avoidance of around $163 billion."