Biden Proposes Massive Expansion of the IRS

The Biden-Harris administration has proposed hiring 87,000 new tax agents and spending $80 billion over the next ten years to double the size of the IRS. The administration claims these new resources would bring in $700 billion of additional revenue, but Congressional Budget Office estimates put the total amount recovered at a fraction of that amount.

The Wall Street Journal reported that this massive influx of cash and staff to the IRS would enable them to “harass tens of thousands of small businesses to find spare change.” Republicans fear that an enlarged tax collection agency could abuse its power and target conservative nonprofits, like Barack Obama’s IRS did in 2013. They also express concerns about privacy and the heavy burden new compliance costs would place on businesses of all sizes still trying to recover from the pandemic.

Politico: Some other Republicans lawmakers worry that a massively expanded IRS would lead to the undermining of a Trump-era rule that prevented the agency from targeting certain tax-exempt groups based on their political beliefs. In 2013, the Obama IRS apologized for giving extra scrutiny to roughly 75 conservative groups that used words like “tea party” or “patriot” in tax documents.

Instead of massive new government spending and staffing, Republicans propose simplifying the tax code, making it easier to catch tax cheats and for businesses to comply. They point to other programs that have successfully recovered billions from tax cheats without doubling the size of the IRS.

Bottom Line: An army of new IRS agents is the Biden-Harris administration’s latest desperate attempt to partially fund their massive $4 trillion spending plan. As Senator Chuck Grassley put it, “Instead of promising a chicken in every pot, Biden’s plan promises an auditor at every kitchen table.”