While there’s been an awful lot of discussion about Joe Biden’s multi-trillion dollar reconciliation bill recently, most of the debate that I’ve seen has surrounded the potential cost, as opposed to what Biden and his fellow Democrats are hoping to do with all that cash. One proposal that’s starting to get some attention, however, is Biden’s plan to require banks to report all consumer transactions of more than $600. According to the White House, this would help the IRS crack down on tax cheats, but as Larry Keane of the National Shooting Sports Foundation writes, the plan would also allow the Biden administration to keep track of gun buyers.
The Biden administration proposes that banks and credit unions report every transaction at the $600 threshold to counter tax cheats. That’s got privacy advocates howling. It is especially concerning for the firearm industry and its customers that the government would collect information that could potentially include firearm purchases. While many firearms sold might not meet that $600 reporting requirement, a significant number would. It threatens to become a back-door gun registry.
Sec. Yellen balked at the notion the government is intruding on financial privacy, explaining the IRS already has “a wealth of information about individuals,” citing examples such as the W-2 form filed for a person’s job, but said the IRS needs more information on “higher-income individuals who have opaque sources of income … not low-income people.”
U.S. Sen. Cynthia Lummis (R-Wyo.) grilled Sec. Yellin over the proposal in a Senate hearing.
“There are obvious privacy concerns for all Americans here and this represents a dramatic new regulatory burden for community banks and credit unions in Wyoming and elsewhere,” Sen. Lummis said. “Do you distrust the American people so much that you need to know when they bought a couch? Or a cow?”
Or a gun.
I don’t know if it’s a matter of distrust as much as it is a desire to snoop and a willingness to ignore the Fourth Amendment. The Biden administration has shown its contempt for the Bill of Rights in multiple ways over the past couple of months, from its proposed rules on pistol braces and home-built firearms that ignore the Second Amendment to its willingness to use the FBI to investigate parents who’ve vocally spoken out at their local school board meetings. The banking proposal is just another example of Biden’s callous disregard for the individual rights of American citizens, but thankfully we’re starting to see some pushback.
The attempt to track Americans’ spending on items $600 or more, which would include firearm purchases, isn’t sitting well with banks or lawmakers. The American Bankers Association wrote to both the U.S. House of Representatives and Senate that the proposal, “…implicates customer privacy and data security on a massive scale…” The letter added that the IRS already collects massive amounts of data it is unable to manage.
Sen. John Boozman (R-Ark.), a member of the Senate Financial Services and General Government Appropriations Subcommittee, published a column in The Hill, ripping the proposed reporting requirements as reckless and ripe for abuse.
“Given the IRS’s track record on data security, including a 2015 data breach, tasking the agency to secure additional taxpayer information from nearly every American is a complicated and hazardous gamble, and one the federal government isn’t historically capable of winning.”
Sen. Mike Crapo (R-Idaho) and Rep. Kevin Brady (R-Texas) introduced the Tax Gap Reform and Internal Revenue Service (IRS) Enforcement Act in both chambers as S. 2721 and H.R. 5206. Rep. Brady said in addition to getting a true assessment of the IRS so-called tax gap, “This bill also protects taxpayers from IRS targeting based on their political or religious beliefs and closes loopholes that risk leaking private taxpayer returns.”
Sen. Crapo added, “This legislation places important guardrails around IRS funding to protect taxpayers’ rights and privacy.”
Sen. Tommy Tuberville (R-Ala.) introduced S.2857, the Banking Secrecy Act, to prohibit any Federal agency from requiring financial institutions to report on the financial transactions of their customers. Sen. Tuberville told media he wants Americans to pay their fair share of taxes, “But I don’t want the federal government, ‘big brother,’ to be harassing private citizens.”
I don’t know too many people who do want that, but that’s exactly what we’re likely to get if the reconciliation bill ends up getting the endorsement of Democrats Joe Manchin and Kyrsten Sinema. Whether or not that happens is still very much an open question, but with Biden siding with the progressives in Congress and applying pressure to the pair, I’m not that optimistic about the entire bill crashing and burning when the Senate ultimately votes on the measure. The details of the reconciliation bill still need to be worked out, however, which means that there’s still time to push back against the awful IRS reporting requirements that would strip Americans of their right to privacy.