It’s very clear that the Republicans believe that they have a winning midterm election message centering on the Democrats’ decision to fund the Internal Revenue Service with $80 billion to modernize the department. In part, as New York Times White House correspondent Jim Tankersley argues, this flows from the fact that alternative strategies are not very attractive. Overall, the provisions of the Inflation Reduction Act are very popular.
…it’s notable that in a bill filled with corporate tax increases and hundreds of billions of dollars in tax credits and spending on health care and climate change, Republicans have focused so heavily on the I.R.S.
It’s largely a reflection of how popular other parts of the law, like reducing prescription drug costs for Medicare and even reducing the budget deficit, are in polls. The ways to raise tax revenue were always likely to be the easiest target.
It’s a near-certainty that if Democrats had substituted a different tax increase for the I.R.S. piece, Republicans would be attacking that instead.
Alan Rappeport, the New York Times Treasury Department reporter, says the GOP has found a ripe area of attack because, “nobody really loves paying taxes or being audited.” But Tankersley counters that “the politics of I.R.S. enforcement are a framing contest…” and “Americans love the idea of making tax-dodging corporations and rich people pay what they owe.”
Of course, there’s an argument on the merits, even if such arguments rarely are decisive in the heat of election season. The Republicans have starved the IRS of resources in the hope that they’ll be less effective in collecting revenues and enforcing the law. This is supposed to be popular, but that does depend on the framing.
The Democrats have promised that this $80 billion investment will make the tax system fairer while also improving customer service. Treasury Secretary Janet Yellin says that while the IRS will be more active, the increase in audits “will target only large companies and people earning more than $400,000 a year.” Meanwhile, in what can only be described as a politically savvy move, she’s decided to use the first tranche of money to “hire people who will answer taxpayers’ telephone calls during the 2023 tax-filing season.”
Nothing makes a voter less favorably disposed to a government agency or program than being put on hold. But this decision also sends a more immediate message that ordinary folks are going to benefit from these upgrades. It’s not about increasing their risk of an audit. It’s about providing a fair system and efficient, competent assistance.
On the audit risks, the Government Accountability Office found that between 2010-2019, the percentage of taxpayers experiencing an IRS audit plummeted from 0.9 percent to 0.25 percent, and that “Audit rates decreased the most for taxpayers with incomes of $200,000 and above.” The explanation is a shortage of staff combined with the increased complexity of examining high income returns.
Of course, many more people fear being audited than actually have to suffer through one, and the number of people audited is cumulative, meaning you could still resent an audit from the 1980s. Still, it seems a very small percentage of voters have had a direct negative experience from the IRS (deserved or not) compared to those with an interest in seeing the rich pay their share.
This is why I call the Republican Party “the tax cheat party.” They not only make it easier for the wealthy to legally avoid taxation, they make it easier from them to illegally evade taxation. And a good chunk of their base is in the market for impunity for tax crimes. After all, the first person to fear an audit is the one who knows an audit would catch them in their lies. Cleaning up honest mistakes can be a hassle and involve fines, but it’s not the end of the world.
This is why I see the IRS-bashing midterm strategy as less than promising for the Republicans. It will fire up their tax-cheat base, but that base isn’t very big and is dwarfed by the number of people who are angry that the IRS lets rich people get away with murder while they have to pay the taxman.
But it is a messaging battle. The Democrats have to engage in that battle or they’ll lose it.
Speaking of tax audits, anybody else remember that odd coincidence of James Comey and Andrew McCabe getting audited through the National Research Program? I’d forgotten. Looks like maybe the IRS hasn’t.
The Biden administration in recent weeks has shown a surprising adeptness at the public relations/communications side of governing: hammering away at the multiple ways the Inflation Reduction Act benefits ordinary Americans and their communities. the IRS hiring customer service representatives; the framing of the student loan forgiveness—both defensively in touting how it benefits the working and middle class, and offensively in attacking Republicans for their PPP loans.
It’s a 21st century version of Harry Hopkins’ New Deal era mantra: “tax and tax, spend and spend, elect and elect.”
>>The Biden administration in recent weeks has shown a surprising adeptness
Amen and Hallelujah!!
you can’t message your way out of not accomplishing anything. But once people somehow got Manchin and Sinema to agree to a pretty good bill, it’s been a run of good things happening in both results and the messaging about them. Repubs making themselves look foolish about the veterans bill was nice too.