House Republicans revealed Tuesday plans to slash funds to the IRS for the 2025 fiscal year, which begins Oct. 1, including money for a free online tax filing system that the Treasury Department recently made permanent and was set to expand to all states and the District of Columbia.
The House Appropriations’ Financial Services and General Government Subcommittee released its Financial Services and General Government Appropriations bill that will provide $23.608 billion in discretionary spending, which is nearly 20% below President Joe Biden’s budget request and nearly 10% below the effective spending level provided in the previous fiscal year, the committee said in news release.
The bill allocates $11.1 billion to the IRS, which is $2.2 billion below the previous fiscal year, and it also reduces enforcement funding by $2 billion.
The bill prohibits the IRS from using any funds to target citizens for exercising any right guaranteed under the First Amendment or to target groups for regulatory scrutiny based on their ideological beliefs.
In October, a report by the House Judiciary Committee and its Select Subcommittee on the Weaponization of the Federal Government revealed how the IRS committed “alarming civil liberties abuses,” as well as the IRS’ targeting of conservative groups seeking tax-exempt status.
The Treasury Department on May 30 announced its free online tax filing system would be a permanent option and invited all states and D.C. to participate for the 2025 filing season. But the House bill prohibits “funds to be used for the IRS to create a government-run tax preparation software that Congress has not authorized.”
“I have worked diligently to ensure this bill provides the resources necessary to protect the integrity of our financial and judicial systems,” said Rep. David Joyce, R-Ohio, chair of the subcommittee, in the news release. “At the same time, this bill reins in wasteful spending and takes steps to prevent agencies like the IRS from unfairly targeting hardworking Americans. By returning these agencies under our jurisdiction to their core missions, this bill guarantees these institutions work for the American people like they were intended to do.”
Republicans have been chipping away at IRS funding after the Inflation Reduction Act in 2022 injected $80 billion into the tax agency’s coffers over a 10-year span. The funding cuts in Tuesday’s proposal didn’t go over well with House Democrats.
“My colleagues across the aisle claim that fiscal responsibility is another one of their priorities, but this legislation continues their assault on the Internal Revenue Service and its ability to enforce current tax laws and collect legally owed revenue,” Rep. Steny Hoyer, D-Md., ranking member of the subcommittee, said in a news release.
Said Rep. Rosa DeLauro, D-Conn., ranking member of the Appropriations Committee: “At every turn, Republicans are showing they are willing to do the bidding of the wealthiest Americans and largest corporations with the highest profits.”
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