(TheRedAlertNews.com) – A new bill agreed upon by leading Democrat Senators will provide $80 billion in additional funding for the Internal Revenue Service, sparking fears that would lead to the tax authorities targeting the American middle class.
The draft of the so-called Inflation Reduction Act proposed jointly by Senate Majority Leader Chuck Schumer of New York and Senator Joe Manchin of West Virginia is going to “turbo-charge” the IRS, according to The Daily Caller.
Allocating tens of billions of taxpayer dollars for the tax institution has also been championed by President Joe Biden ever since he was sworn into office.
The Internal Revenue Service will receive the extra $80 billion over the next nine years, almost doubling its annual budget of $12.6 billion.
The bulk of the additional funding for IRS – $45.6 billion – is going to go to “enforcement,” a term which encompasses “litigation,” “criminal investigations,” “investigative technology,” and “digital asset monitoring” of US taxpayers.
While proponents of the new measure claim that the IRS will now be able to rake in no fewer than $200 billion in additional revenue by targeting those who under-report their income, critics disagree.
According to the editorial board of The Wall Street Journal, this additional revenue will be sucked out of the wallets of Americans from the middle and upper-middle class “because that’s where the money is.”
Preston Brashers, a senior tax policy analyst at the Heritage Foundation, estimates that some $136 billion – or about 70% – from the supposed revenue increase of the IRS due to the Manchin-Schumer bill is going to come from taxpayers with annual incomes below $75,000.
Up to 90% of the $200 billion in new tax revenues would be generated from Americans making under $200,000 per year, and only between 4% and 9% of that would come from those whose annual income exceeds $500,000.
The WSJ editorial board has warned that there will be no hits to the “mega-rich” since the IRS is well aware they are armed with entire armies of accounts and lawyers, meaning that any litigation in that direction would be “time-consuming and risky.”
Besides that, it noted that the growth in IRS enforcement measures will be added to tax increases on the American middle, which are found in the Schumer-Manchin spending package – even if Manchin has been insisting that the bill isn’t adding a single penny in new taxes.
“Most new IRS agents will join the IRS labor union, which gives 100% of its PAC funding to Democrats,” Mike Palicz from Americans for Tax Reform has also cautioned.