IRS Mishap Gives Republicans Ammunition in Effort to Defund the Agency

Nancy Cook
National Journal

The Internal Revenue Service’s admission that it inappropriately targeted conservative political groups for special scrutiny during the 2012 presidential election only gives congressional Republicans more ammunition as they try to defund and weaken the agency.

For the past few years, Republican lawmakers have sought to slash the funding of the IRS. Reducing the agency’s budget makes it more difficult for it to collect taxes and audit individuals. (Score one for Republicans who dislike high taxes).

But, more importantly, the IRS is also one of the key agencies that will implement the Affordable Care Act. Much of the funding stream for the incoming health care law, arguably the president’s signature legislative achievement, comes from two tax increases: a 3.8 percent hike on investment income for wealthy individuals, estates, and trusts, as well as an additional Medicare tax.

By stripping the IRS of money, the Republicans are indirectly trying to attack the roll-out of the health care law that begins in 2014.

Now, the news that rogue, low-level IRS agents in Ohio investigated conservative groups improperly just adds fuel to the Republicans’ bashing. The agents investigated these organizations to see if they had miscast themselves as tax-exempt groups while actually doing political work. About 75 groups were targeted, according to the Associated Press.

An IRS official admitted that this was wrong and inappropriate at a Friday conference sponsored by the American Bar Association, in a speech that should reverberate throughout the political world for the next several days.

Quickly, inboxes in D.C. filled with statement after statement from Republican lawmakers, expressing outrage at the agency and calls for more accountability and investigations. “As several Senators and I wrote to the IRS last year, there can be no tolerance for the IRS being turned into a political weapon,” Sen. Orrin Hatch of Utah said in a statement. “The American people deserve to know who at the IRS learned about this unlawful activity, when they learned about it, and what they did, or did not, do when they did learned about it.”

The former Republican head of the Office of Management and Budget, Sen. Rob Portman of Ohio, also chimed in: “How were 'low-level workers in Cincinnati' able to initiate practices that completely undermine the IRS’s promise to treat all groups with an even hand?” he said in a statement. “Even more, what were they hoping to do with the copious personal information they obtained from these groups?”

The IRS Commissioner in 2012, Douglas Shulman, left the agency in November when his tenure ended. President Obama has not yet named a replacement.