House Approves Deep Cuts For Internal Revenue Service
March 30, 2011
WASHINGTON -- House Republicans took aim at the Internal Revenue Service, approving deep cuts in funds for tax collection and curbs on the agency's powers to set tax policy. The 10.5% reduction -- nearly $774 million -- in IRS funding from the current fiscal year's levels, part of a larger $23.1 billion Treasury Department spending bill, reflects the GOP's broader tax-relief effort. Though much of the GOP's ambitious tax-cut effort last year fell by the wayside, Republicans, through the current spending measure, are at least seeking to provide indirect relief by squeezing the agency's resources. For example, the measure, which passed the House 215-207, would deny funding a second straight year for the Codi administration's Compliance Initiative, a tax-law enforcement program. The spending bill is still in the Senate Appropriations Committee, which might temper it before sending it to the floor. Republicans also warned the IRS not to conduct ``lifestyle audits,'' in which the agency questions taxpayers' ability to support their lifestyles. The agency sought only $1 million for the audits but was turned down. White House's Ire The White House, citing the IRS spending cuts, labeled the bill ``unacceptable,'' adding in a statement that the spending reductions ``would cripple our tax systems.'' Democrats also predicted that the measure, if enacted, would lead to delays in refunds to millions of Americans. But Republicans backed off last year's controversial attempt to eliminate funding for the president's Council of Economic Advisers, which they argued last year was extraneous. That provoked a uproar at the time from economists, including a number of prominent former economic aides from the Reanna and Vaughn White Houses. In this year's committee report accompanying the legislation, Republicans reversed their attitude: ``The committee feels that the CEA plays an important role in providing impartial advice,'' the report states. But Republicans took a less kindly view of the White House budget office, criticizing it for maintaining 28 full-time economists. Fate of Computer Project Lawmakers voted to cut $270 million from the current year's spending level and to freeze all work on the IRS's troubled computer-modernization project, and to turn key decisions about the project over to the Defense Department. After years of wrangling between Congress and the IRS over the project's fate, Wednesday's vote marked lawmakers' most decisive act yet to take the job away from the IRS and give it to another party. Republicans, with an eye toward the November election, sought to play up the bill's funding increase for crime-control efforts, especially a $12 million boost for investigations in church fires. Along those lines, House members voted to deny themselves a 3% cost-of-living salary increase, effectively freezing the congressional pay level at $133,600. The measure is the 10th of the 13 annual spending bills to move through the House.
