Democrats' desire to monitor everyone's bank accounts will allow politicians to "find a way to control how you save and spend your own money," The Wall Street Journal editorial board said.
The Biden administration wants the IRS to review every financial account above a $600 balance, or with more than $600 of transactions in a year. The main objective, progressives say, is to catch tax evaders.
A group of 41 industry groups recently warned congressional leaders, however, that the plan "is not remotely targeted" to detect major tax avoidance, The Wall Street Jorunal board wrote Monday.
The plan also creates a potential data breach, said the Journal, citing an incident in which records of billionaire Jeff Bezos, former New York City Mayor Mike Bloomberg, and other wealthy Americans were exposed by ProPublica.
"Whoever leaked or hacked those records committed a crime, but the IRS has revealed nothing from its promised investigation," the Jornal's board wrote. "Adding bank account info to the IRS trove would risk the disclosure of savings and spending information of political adversaries in the same way."
A total of 23 state treasurers and auditors signed a letter last month opposing the administration’s bank-account plan, calling it "one of the largest infringements of data privacy in our nation’s history."
Democrats wanting to see everyone's money should be no surprise, the Journal said.
"Casting a wide net over personal finances is a longstanding aim for Democrats and the political left," the editorial board wrote. "President [Barack] Obama in 2009 formed a panel to discuss closing the 'tax gap,' arguing that widespread underreporting of income costs the government hundreds of billions a year."
The Journal said House lawmakers continued to debate whether to include the bank-account proposal in the $3.5 trillion dollar spending bill, which already includes $80 billion for the IRS to hire thousands of new employees.
"Overestimating the results of greater enforcement lets the Biden Administration attach a higher revenue number to its multi-trillion-dollar spending proposal. That’s bad enough," the Journal said.
"But the bigger threat of giving the IRS access to the details of your bank account is that politicians will eventually find a way to control how you save and spend your own money. This is a bad idea that deserves to die."
Although Biden's Treasury Department estimates the plan would collect $700 billion in revenue over the next decade, Rep. Kevin Brady, R-Texas, ranking member on Ways and Means, says the actual tax gap is more dubious.
Brady said the Treasury's estimates don't account for the 2017 federal tax reform that limited many loopholes.
"The IRS will admit their data is seven years old," Brady told CNBC in July. "What they’re saying is give us a ton of money, let’s hire a bunch of auditors, and we think this will create revenue."
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