The Congressional Budget Office (CBO) estimates that low-income and middle-class Americans will raise billions in additional tax revenue under the Democrats’ Inflation Reduction Act, according to a press release by Republicans on the Ways and Means Committee.
The CBO investigation into the financial impact of Republican Idaho Sen. Michael Crapo’s failed amendment found that if it were to have passed, the Inflation Reduction Act would have lost at least $20 billion in revenue, according to the report.
“CBO has not completed a point estimate of this amendment but the preliminary assessment indicates that amendment 5404 would reduce the ‘non-scorable’ revenues resulting from the provisions of section 10301 by at least $20 billion over the FY2022-FY2031 period,” the CBO stated, according to Ways and Means GOP.
What’s that mean?
— Rep. Kevin Brady (@RepKevinBrady) August 12, 2022
Crapo’s S.Amdt. 5404 sought to “protect low-and middle-income earning American taxpayers” from the historical growth expected from the influx of funding to the Internal Revenue Service (IRS) from the Inflation Reduction Act, according to the amendment’s statement of purpose. (RELATED: House Sends $740 Billion Green Energy, Healthcare Package To Biden’s Desk)
“To prevent the use of additional Internal Revenue Service Funds from being used for audits of taxpayers with taxable incomes below $400,000 in order to protect low- and middle-income earning American taxpayers from an onslaught of audits from an army of new Internal Revenue Service auditors funded by an unprecedented, nearly $80.000.000.000, infusion of new funds,” S.Amdt. 5404 stated.
It failed along party lines, with all 50 Senate Democrats voting against Crapo’s amendment, according to the Senate’s roll call votes.
Previous CBO analysis showed that the Inflation Reduction Act will see audit rates “rise for all taxpayers,” the GOP members of the Ways and Means Committee said.
The Joint Committee on Taxation, Congress’s official tax scorekeeper, says that from 78 percent to 90 percent of the money raised from under-reported income would likely come from those making less than $200,000 a year,” The GOP Ways and Means Committee report stated. “Nearly half of the audits would hit Americans making $75,000 per year or less and only 4 percent to 9 percent would come from those making more than $500,000.”
Syracuse University’s Transactional Records Access Clearinghouse (TRAC) found that in 2021 the IRS was five times more likely to audit low-income households that make less than $25,000 a year.