A controversial program to have banks report all bank account details to the IRS is possibly dead, Senator Joe Manchin revealed on Tuesday.
The centrist and crucial swing vote on the partisan law said this Tuesday that he discussed the new proposal with Biden, which envisioned having banks report all account transactions over $10,000 to the IRS to crack down on the tax fraud. After their meeting, he said it would probably not succeed.
Manchin said he informed Biden that the idea was “messed up” and that Biden concurred.
“So, I believe that one will be gone,” the West Virginia Dem said during his appearance at the Economic Club in Washington this Tuesday morning.
The first iteration of this proposal was even broader idea that would have targeted every inflow and outflow greater than $600. However, that was met with a lot of opposition from the banking sector and lawmakers on Capitol Hill.
The idea was supported by Senators Ron Wyden from Oregon, who leads the Finance Committee, and Elizabeth Warren from Massachusetts. The proposal was also supported by Treasury Sec. Janet Yellen.
Wyden noted that Biden’s IRS Commissioner Charles Rettig said that the tax gap might be as high as $1 trillion a year and that the reporting program would narrow this gap, which represents the total taxes owed versus the taxes paid.
“Working Americans pay their taxes since they know their job sends their numbers to the IRS,” Wyden said. “A wealthy business owner, however, is using an honor system. The common arguments against details reporting have always stayed the same, and they have always been wrong.”
Republicans believe the financial reporting requirements break privacy and would be difficult. The Republicans have pointed out the recent IRS leak of taxpayer docs to one media outlet, further harming public trust in the group.
This is undoubtedly about the Democrats current large mutli-trillion dollar social spending plan which they are desperately trying to pay for. They have also recently announced another controversial tax scheme: taxing stock profits before the stock has been sold. An idea that, if successful, will also, in our opinion, be applied to Bitcoin sooner or later.
Author: Blake Ambrose