The “surge” in IRS hiring is being compared to a military buildup by Republicans in Congress. The Inflation Reduction Act (sic) provides for an increase in IRS agents of 87,000 over a ten-year period, and a Republican study found that the additional agents will mean 710,000 more audits for taxpayers making $75,000 or less.
Related: Calling B.S. on White House Claims of No Increase in Audits for Middle Class
Perhaps it’s appropriate to describe the “new IRS” in military terms.
House Minority Leader Kevin McCarthy says Biden’s new “army” will be larger than the president’s hometown.
Democrats in Washington plan to hire an army of 87,000 IRS agents so they can audit more Americans like you.
That’s more than the entire population of Joe Biden’s hometown of Scranton, PA.
— Kevin McCarthy (@GOPLeader) August 11, 2022
Texas Sen. Ted Cruz thinks we have to “Stop Biden’s Shadow Army!”
The Manchin-Schumer bill will create 87,000 new IRS agents to target regular, everyday Americans.
STOP BIDEN’S SHADOW ARMY! pic.twitter.com/DgJQ1K1KBJ
— Senator Ted Cruz (@SenTedCruz) August 5, 2022
And Louisiana Sen. John Kennedy said on Fox News that Biden’s new IRS will have “more agents, or soldiers, than the entire Israeli army.”
.@SenJohnKennedy: "The IRS will have more agents or soldiers than the entire Israeli army…" pic.twitter.com/UtlJdeLBmN
— Jackson Richman (@jacksonrichman) August 11, 2022
A truly colorful metaphor but, alas, it’s not true. As the Jerusalem Post reports, “According to a 2021 assessment by the International Institute for Strategic Studies, the IDF has approximately 169,500 active personnel.”
Sorry, John, but it was worth a giggle.
There are other things that the 87,000 new IRS agents can do. Elizabeth Warren wants to borrow a few of them to prepare citizen’s tax returns.
Yes, really.
A small part of the funding includes $15 million dedicated to fund a task force to study the cost and feasibility of creating a free direct e-file program, which has been a controversial idea.
Warren wasn’t planning to wait for a task force study and already filed a bill to develop a free, online tax preparation and filing service that allows all taxpayers to prepare and file their taxes directly with the federal government instead of through private tax preparers.
The Warren proposal would move more quickly to allow filers with simple tax situations to choose a “return-free option” that provides a pre-prepared tax return with an income tax liability or refund amount already calculated. Proponents also say it would reduce tax fraud by getting third-party income information to the IRS earlier in the tax season.
Grover Norquist, president of the conservative Americans for Tax Reform, points out the obvious. “The IRS is the prosecutor and the judge under this system. All the incentives are wrong,” Norquist told FOX Business.
It’s not just the right who’s objecting to the IRS becoming tax preparer and tax collector at the same time. “The IRS does not have the necessary information in its databases to accurately determine a low-income taxpayer’s eligibility for EITC [Earned Income Tax Credit] and/or correctly calculate the amount of credit due to the taxpayer — indeed, far from it,” a Progressive Policy Institute report says. The EITC is rife with abuse but the report makes a valid point: too many opportunities for poor taxpayers to slip through the cracks.
We can all agree the IRS needs reform. But the Biden administration is going about it all wrong.
The Biden administration sees things differently. It does not propose to reform the IRS at all — it proposes to use the agency as a jobs program. And that is liable to make things worse rather than better: Rewarding a corrupt and ineffectual agency by doubling its payroll sends precisely the wrong signal.
And it is not clear that the agency needs more employees at all. By my rough estimate, the United States already has about twice as many federal tax officers per capita as does thrifty and well-governed Switzerland. If the Biden expansion comes to pass, the IRS will have about five times as many employees per capita as does its Swiss counterpart — and it would be a very considerable understatement to observe that Switzerland has much more comprehensive tax compliance and a much more orderly revenue system than does the United States. It achieves this in part by relying on a strategy that we are supposed to know something about here in the United States: federalism.
“Federalism” is a dirty word on the left and is usually accompanied by the scare quotes “states’ rights.” But if there’s one thing the IRS needs as much as reform, it’s a fresh approach to its job. Not a bunch of new people; new ideas to simplify the tax system and make paying taxes less of an exercise in pulling teeth.
But once Biden’s IRS army begins the Long March, there will be no stopping it.
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