House Speaker Nancy Pelosi retreated from President Biden’s push to give the Internal Revenue Service access to all bank transactions above $600 on Tuesday, saying that while she was committed to the policy its threshold would be subject to “negotiation.”
Mrs. Pelosi, California Democrat, was asked during a Capitol Hill press conference about the provision, which is tucked away inside President Biden’s $3.5 trillion expansion of the federal safety net.
The speaker asserted that the proposed expansion of IRS powers would help bring in new revenue to pay for the massive spending package and would also crackdown on wealthy tax scofflaws.
“There are concerns that some people have, but if people are breaking the law and not paying taxes, one way to track them is through the banking measure,” said Mrs. Pelosi. “I think $600 … [that] negotiation will go on as to what the amount is.”
Democrats are pushing for regulations within the $3.5 trillion package that would require banks to report annually on the “inflows and outflows” of personal and business accounts.
The reporting requirement would cover any transaction above $600 or bank accounts with deposits totaling that sum. Some Democrats are also pushing for rules to cover mobile money transfer systems such as PayPal and Venmo.
Critics say the low reporting threshold would essentially give the IRS unfettered access to how ordinary Americans spend their money. Some Republican lawmakers say the expansion of federal powers would amount to a “surveillance state.”
Concern over the proposal has grown among voters and even some high-profile Democrats in recent weeks.
“Let me get this straight: Biden wants the IRS to violate our privacy by collecting info on all financial transactions over $600 so they can stop really rich people from hiding money,” tweeted former Hawaii congresswoman and 2020 Democratic presidential candidate Tulsi Gabbard. “It’s just Big Brother trying to get more power to snoop on and control regular Americans.”