To the average American, the IRS scandal gives extra juice to the argument for tax reform. In Washington, though, it appears to give politicians another distraction from it:
The unfolding scandal over the agency improperly targeting conservative groups is forcing the chief tax writers in Congress to shift attention away from the comprehensive tax code overhaul they’ve been aggressively pursuing.
[Chairman Baucus and Chairman Camp] have said they want to move on tax reform this year, a tough challenge even before the IRS developments came to light. But the scandal throws that timeline even further into doubt as precious time — and political capital — that would have been dedicated to seeking reform could now be co-opted by the IRS probe.
This is preposterous. Congress is completely capable of investigating the IRS while working towards tax reform – or should be, at least. It’s not as if policy proposals on reform don’t exist – there was the Wyden-Gregg reform bill several years ago, and the Fair Tax and Flat Tax are incredibly popular among certain circles in Congress and the country. Furthermore, Congress can have an open and transparent debate and discussion on the subject without formal hearings.
Admittedly, the politics of tax reform have always been difficult. Democrats typically want to raise taxes as part of “reform,” thus rewarding Congress’…shall we say…spendthrift ways with more of your tax dollars. Meanwhile, many Republicans do not want to harm their political benefactors by taking away certain loopholes and credits. But let’s remember it’s the staff of Members, and the staff of the various committees, that actually craft and write legislation. These staff members can certainly focus on more than one task at a time.
Finally, political capital and “precious time” notwithstanding, the IRS scandal should effectively gift-wrap tax reform for anyone who wants it. Who will be willing to stand up and defend the IRS’ current levels of power and influence over the average American, over who qualifies for tax credits and loopholes, etc.? If anything, curtailing IRS abuses of power should accelerate Tax reform.
For now, it appears both Chairmen are not intending to let the IRS scandal get in the way:
Camp and Baucus say they don’t expect the IRS scandal to deter them from their ultimate bid for tax reform. Both committees have oversight of everything from tax policy to health care and trade so they’re accustomed to working through competing priorities.
“The committee has pretty expansive jurisdiction and is used to having a lot going on simultaneously,” said Camp spokeswoman Michelle Dimarob. “Given that we have some experience with multi-tasking, this won’t impede the committee’s work on comprehensive tax reform.”
For his part, Baucus is calling the scandal an opportunity.
“It is all the more reason we need tax reform,” Baucus told POLITICO. “This is an area of law that needs to be reformed.”
It’s good to see both sides of the aisle agree the IRS has abused its power. Now it’s time to put action behind the words, and implement tax reform that de-weaponizes the IRS.