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Illustration: Sarah Grillo/Axios

Republican senators are rallying against one of the main ways President Biden wants to pay for his infrastructure deal — a $40 billion infusion to help the Internal Revenue Service collect $100 billion more in taxes.

Why it matters: If this partisan sentiment is as widespread as several Axios interviews suggest, it raises doubts about whether the IRS funding proposal can make it into law. That makes the math even fuzzier for how to pay for the $1.2 trillion deal.

What they're saying: Sen. John Barrasso (R-Wyo.), chair of the Senate Republican Conference, told Axios that "spending $40 billion to super-size the IRS is very concerning," and "law-abiding Americans deserve better from their government than an army of bureaucrats snooping through their bank statements."

  • Sen. Ted Cruz (R-Texas): "Throwing billions more taxpayer dollars at the IRS will only hurt Americans struggling to recover after waves of devastating lockdowns. ... Instead of increasing funding for the IRS, we should abolish the damn place."
  • Sen. Marsha Blackburn (R-Tenn.): "A $40-billion increase in funding for the IRS will lead to a huge potential for abuse. Bigger government results in more waste, fraud and abuse."
  • Sen. Lindsey Graham (R-S.C.): "A lot of this can be pie in the sky. ... There's some people on our side who don't like empowering the IRS; I don't mind empowering the IRS if it's a reasonable thing to do. But I mean, how much uncollected taxes can you gather with $40 billion?"

Graham's comments are noteworthy given that he has announced his backing for the deal.

Flashback: Congressional Republicans have worked to starve the IRS by shrinking its budget by roughly 20% from 2010 to 2018.

  • Smaller IRS budgets mean fewer audits — and more room for tax evasion.
  • According to the Washington Post, those cuts led to 30% declines in the number of employees in the IRS enforcement division, "with even steeper drops among the highly specialized workers who handle the most complex cases."
  • The bipartisan infrastructure deal would inject the agency with a substantial boost in funding — increasing its annual budget by more than a third over 10 years.

Between the lines: Republican senators cite a catalogue of grievances with the IRS as reasons why Congress shouldn't be giving it more money.

  • They include aggressive scrutiny of Tea Party groups during the Obama administration, and a recent massive leak to ProPublica of some of the wealthiest Americans' tax returns.

The bottom line: It's a good time to be a tax-dodger in America.

  • The IRS has been stretched to a near breaking point during the pandemic, as lawmakers have added new responsibilities involving stimulus checks, unemployment benefits and the Child Tax Credit.
  • IRS Commissioner Charles Rettig has estimated the agency is collecting at least $1 trillion less in taxes than what the federal government is owed annually.
  • "The IRS absolutely needs more resources across all lanes," he told Congress in April. "We do get outgunned. There's no other way to say it."

Go deeper

Sep 22, 2021 - Politics & Policy

The Democrats' debt dilemma

Illustration: Aïda Amer/Axios

Democrats find themselves in a political and potentially catastrophic economic quagmire as Republicans stand firm on denying them any help in raising the federal debt ceiling.

Why it matters: The Democrats are technically right — the debt comes, in part, from past spending by President Trump and his predecessors, not only President Biden's new big-ticket programs. But Senate Minority Leader Mitch McConnell (R-Ky.) is saddling them with the public relations challenge of making that distinction during next year's crucial midterms.

Updated 4 hours ago - Politics & Policy

Omicron dashboard

Illustration: Brendan Lynch/Axios

  1. Health: Pfizer and Moderna boosters overwhelmingly prevent Omicron hospitalizations, CDC finds — Omicron pushes COVID deaths toward 2,000 per day — The pandemic-proof health care giant.
  2. Vaccines: The case for Operation Warp Speed 2.0 — Starbucks drops worker vaccine or test requirement after SCOTUS ruling — Kids' COVID vaccination rates are particularly low in rural America.
  3. Politics: Biden concedes U.S. should have done more testing — Arizona says it "will not be intimidated" by Biden on anti-mask school policies — Federal judge blocks Biden's vaccine mandate for federal workers.
  4. World: American Airlines flight to London forced to turn around over mask dispute — WHO: COVID health emergency could end this year — Greece imposes vaccine mandate for people 60 and older — Austria approves COVID vaccine mandate for adults.
  5. Variant tracker

Arizona governor sues Biden administration over COVID funds tied to mandates

A teacher prepares a hallway barrier to help students maintain social distancing at John B. Wright Elementary School in Tucson, Arizona, on Aug. 14, 2020. Photo: Cheney Orr/Bloomberg via Getty Images

Arizona Gov. Doug Ducey (R) filed a lawsuit Friday against the Biden administration for ordering the state to stop allocating federal COVID relief funds to schools that don't comply with public health recommendations such as masking, the Arizona Republic reports.

Why it matters: The Treasury Department said last week that the state would have to pay back the money if Ducey does not redesignate the $173 million programs to ensure they don't "undermine efforts to stop the spread of COVID-19."