Kevin McCarthy will let the US lose billions to make political points about IRS agents | Opinion

It was just about a year ago that then-House GOP leader Kevin McCarthy and fellow Republicans were cranking up their opposition to President Biden’s plan to hire 87,000 new employees for the Internal Revenue Service.

“Democrats are scheming to double the size of the IRS by hiring an army of 87,00 new agents to spy on Americans,” McCarthy said last August in a posting on Twitter.

Now McCarthy, the Bakersfield Republican, is the House speaker and one of the most powerful politicians in the nation. Shortly after he won that post — one he coveted for years — McCarthy and fellow conservatives passed a bill in January to remove $71 billion in funding for the IRS. The Democrat-controlled Senate has ignored it.

Nevermind the fact that Biden never said he would hire 87,000 agents. Rather, it would take that many employees — of all kinds, such as tech support, clerical help, etc. — to raise the level of the IRS’ customer service. To be sure, many of the new hires were intended to be agents who could perform audits. But it was nowhere near the “army” the conservatives used as scare language.

The Bee Editorial Board then faulted McCarthy for choosing politics over the real need to improve the IRS and its customer service. The board noted that some people were waiting years for tax refunds and credits they were owed because the government had not yet processed their paperwork.

IRS seeks tax cheats

Fast forward to the past few weeks as McCarthy and Biden negotiated for ways to increase the national debt ceiling. Among the cuts Biden agreed to was a $20 billion reduction in IRS funding.

Now comes an analysis by researchers at Harvard University, the University of Sydney and the U.S. Treasury Department, which found that by cutting the $20 billion from the IRS, the federal government will lose out on $220 billion in revenues it might have received in the coming 14 years.

The Washington Post first reported the analysis and said how audits of the highest-income earners result in significant new revenues for the government.

“For every additional dollar spent auditing people in the top decile of the income distribution, the government can expect to get 12 times that amount back,” the Post reported.

It should be emphasized that auditing is done when the IRS detects something is amiss. Taxpayers who are honest have no worries. Those who claim personal vehicles as business expenses, or who don’t fully report all their income, are examples of those being sought.

The term for those who deliberately misstate information on their tax forms is cheating. That is precisely what the IRS funding that Biden proposed would have ferreted out.

Furthermore, cutting the IRS funding by $20 billion means losing revenues the U.S. government badly needs.

As of Tuesday, the national debt stood at $32 trillion. If that had to be paid off immediately, every American would have to come up with $95,000, estimates the Peter G. Peterson Foundation, which operates the national “debt clock.”

The debt has resulted because the government spends more than it takes in. Cutting spending, which McCarthy and fellow conservatives preach, is just one side of the equation. Getting more revenues also helps. That is especially relevant when the revenue is legitimate and people are deliberately avoiding paying what they owe.

If McCarthy believes in the rule of law as much as he frequently says, then he should remember that cheating on your taxes, especially by those who are wealthy, is unfair and illegal. It should not be given a free pass simply to make political points.