U.S. Sen. Mike Crapo (R-ID) recently introduced a resolution designed to shield the financial privacy of Americans while reducing red tape in the banking industry.
His proposal would have prevented “the monitoring and reporting of sensitive American taxpayer information to the Internal Revenue Service,” but Democrats in the chamber voted it down, the Daily Caller reported.
According to his website, Crapo’s proposed amendment was a response to the Democratic-backed $3.5 trillion budget resolution — specifically a new mandate requiring that private-sector financial institutions regularly turn over deposit and withdrawal records for customers with more than $600 in their accounts.
Politico reported that the legislation will also provide the IRS with $80 billion in extra funding to cover the cost of hiring nearly 90,000 employees.
“The IRS financial institution reporting requirement forces financial institutions to turn over detailed bank account information to the IRS based on vague and ‘flexible’ criteria, such as a $600 threshold and account inflows and outflows, which are determined by the IRS,” the senator complained.
He went on to argue that the “time-draining burden disregards banking privacy in order to squeeze more resources out of responsible Americans and entrepreneurs.”
Among Crapo’s concerns is that the mandate “subjects law-abiding Americans to more intense targeting from the IRS and additional data collection.”
“Undue monitoring and reporting”
His remarks referenced the massive leak of tax information released by ProPublica earlier this year as cause for additional alarm.
For her part, White House Press Secretary Jen Psaki interpreted the leaked documents as an illustration of how wealthy individuals minimize their tax burden, an issue the Biden administration has vowed to address.
“There is more to be done to ensure that corporations, individuals who are at the highest income are paying more of their fair share, hence it’s in the president’s proposals, his budget, and part of how he’s proposing to pay for his ideas,” she said in June.
Of course, Crapo and others on his side of the aisle do not believe reporting requirements are justified.
“I have long been critical of big data collection activities, and oppose turning banks and brokers into government tax collectors,” the senator said. “My amendment prevents the undue monitoring and reporting of sensitive American taxpayer information to the IRS by financial institutions about deposits and withdrawals made by any individual or business.”