If you are bothered by the fact that the U.S. government seeks to monitor and observe your bank account, you are not the only one in this. There are a lot of consumers, lawmakers and banking trade groups who are opposing the idea of monitoring the accounts of citizens, which was presented in May from the U.S. Treasury Department being a part of its budget request.
Government Has its Own Reasons for Presenting Such Idea
There is a reason for every action. The U.S. government also has its reason behind such an idea. The proposal is offered for the aim of President Joe Biden, who wants to get tough on the taxes yet to be paid, especially from big businesses wealthy Americans. As per The New York Times reports, those pending taxes amount nearly up to $7 trillion, which is really massive. The Biden administration seeks that money to support social and economic plans financially.
What is Required as Per the Proposal
The proposal which the U.S. Treasury Department presents proclaimed that banks need to observe and keep a note of every transaction on the account, how much amount is going in and out regularly from the bank accounts. Still, it has provided a certain exception to the proposal, those accounts with less than the transaction of $600 per annum or those whose aggregate balance is less than $600 as per reports. Individual transactions would not be listed, and Treasury authorities claim that such a plan would not result in more audits of the Americans with average income only.
But it looks like banks and other financial institutions are not delighted with the proposal, and they are expressing their resentment by continuous advertising and letter-writing programs to bring awareness about the same, and this has resulted in a stream of phone calls, complaints and emails as well from the bothered personal and account holders of small businesses.
The CEO of the single-branch Citizens Bank of Edmond in Oklahoma, Jill Castilla, said during an interview that “We have heard a lot from our customers about their concerns about their privacy,” adding further “I’ve gotten calls, emails, and then we’ve had many customers come in.”
The proposal aims To Focus On High Earners.
However, since CBS News declared, the U.S. Treasury departments’ authorities are making attempts so that the threat and doubts regarding the actual effect of such a plan would have on the maximum of citizens. The authorities claim that the dread of facing more audits is baseless and clarify that the Biden administration has pledged not to raise the number of audits upon those Americans earning an income of less than $400,000 in a year. Despite that, the aim will be upon those earning very much yet don’t report their income to escape paying taxes.
IRS To Know Only The Inflow And Outflow From The Bank Accounts
Above all, the IRS will get to know only about the money going in and out of the individual’s bank accounts and not about their spending habits.
Janet Yellen, the Treasury Secretary, said that “The proposal involves no reporting of individual transactions of any individual,” continuing further “If somebody reports an income of $10,000 and they had $3 million go out of their checking account, that tells the IRS that’s an individual you might audit.”
Those who support the proposal also put some light clarifying that it won’t add any new taxes further. Still, the motive is only to make sure that all taxpayers adequately pay their liabilities without evading tax.
What Has Been Said by the Director of Federal Tax Policy Steve Wamhoff
The director of federal tax policy at the Institute for Taxation and Economic Policy, Steve Wamhoff, claimed that “We are all supposed to pay income taxes on our income,” adding further “This idea that you have some right to not tell the IRS about the income you have, there is no such right. That doesn’t exist. We are literally talking about enforcing the law that is already on the books.”
This plan is a portion of a wider attempt to put up with those taxes that an individual is supposed to pay on income they are earning, but rather they choose to evade from paying the liable taxes. As per the report, an anticipated amount of $160 billion of taxes per year remains unpaid by the wealthy and stable taxpayers of about 1 per cent.
