The Internal Revenue Service would gain sweeping new powers under President Obama's healthcare reform proposals, in what Republicans on the House Ways and Means Committee are calling a "dangerous expansion" of IRS powers.
That's according to a nine-page Republican report from the Committee on Ways and Means on Thursday. It's titled "The Wrong Prescription" Democrats' Health Overhaul Dangerously Expands IRS Authority."
Among the new powers the IRS would assume, the report says: The authority to confiscate tax refunds, to impose fines of over $2,200 per taxpayer, and to verify whether taxpayers' health insurance coverage is "acceptable."
One measure of the scope of the IRS' new responsibilities under the healthcare overhaul: The agency might have to hire as many as 16,500 additional auditors, agents, and other employees in order to administer the program, according to Rep. Dave Camp, R-Mich., the ranking Republican on the Ways and Means Committee.
"It is a very dangerous expansion of the IRS' power and reach into the lives of virtually every American," Camp said in a statement released Thursday afternoon.
The Ways and Means report portrays healthcare reform as having a wide-ranging impact on how the IRS operates, including:
- IRS agents would be tasked with determining whether Americans had obtained the insurance coverage required under the individual mandate.
- Individuals could be fined $2,250 or 2 percent of income, whichever is greater, if you are unable to prove you have "minimum essential coverage."
- The IRS would be empowered to confiscate tax refunds if necessary.
- Audits probably would increase as a result of the legislation's new requirements.
- The budget for IRS operations will balloon by $10 billion in the next decade in order to administrate the new program.
- Nearly half of the new individual mandate taxes will be paid "by Americans earning less than 300 percent of poverty, $66150 for a family of four.
A statement that Democrats are sure to dispute, the report, which Camp and fellow GOP Rep. Charles Boustany of Louisiana prepared, says healthcare reform would "fundamentally alter the relationship between the IRS and taxpayers."
Essentially, the Republicans state, the reform bill makes the IRS responsible for "tracking the monthly health insurance status of roughly 300 million Americans."
They express the concern that reform would alter the IRS' traditional mission of collecting revenue, and adding a social-program delivery function to its portfolio.
"This is an unprecedented new role for the IRS — one that will inject the IRS even further into the lives of American families," the report warns.
Ironically, two groups of residents would be declared exempt from IRS enforcement measures, according to the Republicans: One is illegal immigrants who aren't supposed to be included in the insurance exchanges in the first place. The other consists of people who are incarcerated.
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