Biden looking at his watch during the dignified transfer event.
Politics

GOP Senators Line Up To Denounce Biden’s Plan To Track Bank Transactions Above $600

Liam Edgar September 30, 2021

President Joe Biden has provided Republicans with plenty of rhetorical ammo to carry into next year’s elections.

For example, Biden has opened the U.S. border to rampant herds of illegal immigrants; infused woke politics into everything from the Pentagon to education to COVID relief aid; botched the retreat from Afghanistan and left Americans behind; propelled inflation upward to levels unseen in decades with reckless spending; and acted like a tyrant by ignoring the U.S, Supreme Court’s ruling declaring the CDC’s rent moratorium unlawful, and by seeking to impose a national vaccine mandate.

But the GOP may have encountered one policy that will resonate with voters at all levels: the U.S. Treasury Department’s demand to mine information from low-level bank transactions.

Treasury Secretary Janet Yellen and IRS Commissioner Charles Rettig recently petitioned Congress to force banks to report to the IRS any bank transaction that exceeds $600.

The government maintains the move is critical to catching tax cheats and would saddle banks with a minimal additional requirement to what they already must report to Washington.

Additionally, the Biden administration claims the heightened monitoring would raise about $460 billion over the next decade, or about $46 billion a year.

To put that in context, based on what the federal government spent last year, that amount would fund the government for about 60 hours.

Accordingly, GOP lawmakers are rejecting the idea.

Chief among them is Wyoming Sen. Cynthia Lummis, who unloaded on Yellen during a Senate hearing Tuesday.

In comments directed at Yellen, Lummis said, “Do you distrust the American people so much that you need to know when they bought a couch? Or a cow?”

“My constituents cannot believe that you support a proposal to require banks and credit unions to report customer data to the Internal Revenue Service for transactions of $600 or more. There are obvious privacy concerns for all Americans here.”

She added that the request entailed a “dramatic new regulatory burden” for banks and credit unions, which will be forced to hire contractors “to rat on their customers, implement new computer software and deploy resources better used elsewhere in order to collect data for the government.”

“Bank customers are not subjects of the federal government. Banks do not work for the IRS. This is an invasion of privacy,” Lummis continued. “Wyoming’s people literally will find alternatives to traditional banks just to thwart access to their personal information – not because they are trying to hide anything, but because they are not willing to share everything.”

“I think it’s invasive, I think privacy for individuals is getting ignored, and I think treating the American people like they are subjects of the government is unconscionable,” Lummis added.

Elsewhere, Lummis was one of 25 Republican senators who sent a letter to Democratic Majority Leader Chuck Schumer denouncing Yellen’s plan.

“This troubling proposal would create serious privacy concerns for American taxpayers,” the letter said. “In addition, it would be unreasonably burdensome for financial institutions across the nation, particularly those community financial institutions serving families and small businesses across America.”

“Contrary to claims that this proposal would only provide a ‘distinct benefit’ to already compliant taxpayers, this proposal would compromise the privacy of an inordinate number of law-abiding Americans whose confidential financial information would be sent by their financial institution directly to the IRS.”

The senators pointed out that the IRS is hit with 1.4 billion cyberattacks each year, and has a problem preventing leaks of taxpayers’ information.

“Given the IRS’ troubling record of failing to protect certain confidential taxpayer information and abusing its authority, specifically the targeting of conservative political groups, this proposal would undermine trust in the financial system and, in turn, reduce financial inclusion,” the senators argued.

The lawmakers noted that many “unbanked” households already skip having a bank account because they simply do not trust banks. Meanwhile, a quarter of all taxpayers don’t trust the IRS to protect their tax records or fairly enforce the tax laws.

“Giving the IRS access to additional confidential financial information would only compound existing mistrust and drive more people out of the financial system and away from access to regulated financial products,” the letter states.

This “radical departure” from current bank-reporting requirements, the lawmakers maintain, “would not only adversely affect these institutions and their customers – who ultimately pay the price for compliance costs – but it would also inundate the IRS with layers of new paperwork and taxpayer data that is either redundant or irrelevant to improving federal tax compliance, as account inflows and outflows are not taxable events.”

“Simply flooding the IRS with more data and burdening taxpayers, financial institutions, and already overwhelmed IRS service centers with more paperwork is of questionable value, especially when the IRS does not effectively use data already in its possession,” the senators concluded.

“It is a misguided and privacy-invasive proposal, and its consideration is nothing more than an attempt to find a way to pay for a fraction of this irresponsible spending bill currently under consideration.”

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