Kathryn Oliver is all in (Aug. 3) on the Democrats’ Inflation Reduction Act, but at what cost to the average taxpayer? Congress’ bipartisan Joint Committee on Taxation estimates tax rates will go up in 2023 for nearly every income bracket. Taxes will go up a staggering $16.7 billion on taxpayers earning less than $200,000 per year and $14.7 billion on those earning between $200,000 and $500,000. The study rebuts Joe Biden’s campaign promise, a lie, that he would not raise the taxes on Americans who earn less than $400,000 per year.
The bill also provides $80 billion in new funding for the Internal Revenue Service. That’s more than SIX TIMES the IRS’ current budget of $12.6 billion. Why the increase? Chuck Schumer and company tell us the increase will fund more “enforcement” and “technology,” which is code for more tax audits on average taxpayers and small businesses. The JCT estimated 78-90% of the additional tax revenue raised by the IRS would come from those of us making less than $200,000 per year. Only 4% to 9% would come from those making more than $500,000 per year.
As for “inflation reduction” as the Democrats trumpet with their new bill, the Penn Wharton business school projects that the effect on inflation is “statistically insignificant through 2031.”