IRS Chief Tells Elizabeth Warren: More Transparent Bank Data Can Fight Tax Evasion -
"Rettig, a Trump administration holdover, touted a provision in the American Families Plan that would require banks to report on their customers’ withdrawals and deposits."
Why this is important: The important quote in this is, "for every 1% improvement in tax compliance, federal annual revenues are projected to increase by about $30 billion per year." In other words, increase tax compliance, likely in the mid-80 percents, by 7 percent, and federal revenue goes up by $2 trillion! That's a good thing, right? The aim is to "get" the "rich" tax cheats. But how many laborers do work on the side for cash? How many service people do not report all their tips? How many aliens do work "off the books" to avoid INS detection. I am not defending any of that, but there is an underground economy, and it is more critical to the poor than the rich. The rich can move most of their cash offshore! Also, look at another set of cumbersome regulations and disclosures placed on banks. How will the banks manage the inevitable exceptions? Doesn't this fly in the face of the Bank Secrecy Act? This is a hot mess found in the American Families Plan and the bipartisan infrastructure deal, so beware.
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