The plan requires banks and other financial institutions to report all inflows and outflows of over $600 to the IRS.
The plan allegedly promotes honesty in reporting of income, but it remains likely that it will harm the middle and lower classes.
House Minority Leader Kevin McCarthy, along with more than 40 banks, urged Nancy Pelosi and other lawmakers to vote down the privacy-wrecking proposal.
They also warned of the “tremendous liability” that would be involved for banks — costs that private individuals will pay.
Further, Republicans fear how “the IRS will store, protect, and use this enormous trove of personal financial information.”
Adam Brandon, FreedomWorks President, also criticized the proposal, suggesting the Biden administration would use a politicized IRS to target conservatives.
“The IRS has always had its eye on your money– now it wants to know every single deposit and withdrawal you make at the bank,” he said. “Not only would this give the IRS access to more information than it could ever process, this is a major violation of Americans’ privacy, as the private information of more than 100 million Americans will be funneled into the hands of one of the most notoriously weaponized agencies in recent history.”
“The Biden IRS is clearly never going to miss out on a chance to take a peak at Americans’ wallets,” he added.
The Biden administration defended its plan, arguing that it would force the wealthy to pay more taxes.
According to Secretary of Treasury and former Federal Reserve chair Janet Yellen, “it is important to ensure that the reporting regime is sufficiently comprehensive, so that tax evaders are not able to structure financial accounts to avoid it.”
“Any suggestion that instead this reporting regime will be used to target enforcement efforts on ordinary Americans is wholly misguided,” she added.