US President Joe Biden has rattled the free world with his plans to have the Internal Revenue Service (IRS) snoop on bank accounts with at least $600 (about R9 000) in a move to enforce tax payment.
Under the plan, banks and other financial institutions would be required to annually report customers’ account inflows and outflows of $600 or more to the IRS.
However, American banks – citing increased costs of such a measure, are pushing back against the Biden plan, which the White House estimates could generate $463 billion in additional revenue over the next decade.
Media reports from the US say if Congress approves the measure, it could fund Biden’s sweeping $3.5 trillion family and climate change plan.
Critics warn the move would give the IRS and banks an enormous burden to manage such information.
“Fundamentally, this proposal is about ensuring that those at the top pay what they owe,” the White House said.
“The audit rate guardrails are key to the proposal and will protect working people.”
Americans fiercely guard against state power intruding on their privacy. Some see the controversial tax move as the “weaponisation” of IRS bank account surveillance.
Many are concerned about the collection of financial information without a proper explanation of how the IRS will store, protect, and use this enormous trove of personal financial information.
Banks say the plan would create a tremendous liability, increase compliance costs and add to the already existing burden the industry faces in turning over information to the federal government.
While Big Brother already watches over Americans day and night using sophisticated technology systems, it remains to be seen if those beady eyes will pry into bank accounts with more than $600.
At least two Senate Republicans concerned about protecting privacy rights have moved to introduce a Bill that would put an end to Biden’s plans.