There’s a lot not to like about the “Inflation Reduction Act” – starting with the title. The Congressional Budget Office said the bill will have a “negligible effect” on inflation, estimating that inflation will range from a reduction of 0.1% to rising by 0.1%.
The IRS gets a large infusion of cash, amounting to $80 billion, to hire new enforcement agents. The plan anticipates new spending to be partially offset by increased enforcement, ie audits. While it’s important that our tax system is fair IRS enforcement is not among the biggest challenges facing that agency. At the Montana Chamber Business Days at the Capitol this year, Ron Yates with Eide Bailly, lamented the real challenges facing that agency. Chief among the challenges is the antiquated technology the agency is using, citing the fact that IRS employees hand enter data provided by taxpayers filing hard copy tax returns. It’s a big part of the reason the IRS is so backlogged.
After languishing late last year and then seemingly dead by Christmas, public discussion and conversation about the bill and it’s provisions ended. Senator Joe Manchin (D WV) thrust the issue back into the arena at the end of July and the rush was on to pass it. At 730 pages, analyzing and understanding the full intended and unintended consequences of the bill is not possible. President Biden is set to sign the bill into law today.
The Montana Chamber joined other national, state and local business advocacy organizations in opposing the “Inflation Reduction Act”, and we signed onto letters with the U.S. Chamber of Commerce and the National Association of Manufacturers Coalition Letter on the Inflation Reduction Act | U.S. Chamber of Commerce (uschamber.com).
There’s a lot to understand in this bill. The Montana Chamber will work with our national partners and other experts to pass along relevant information as it becomes available.