WASHINGTON, D.C. – President Trump is answering Americans’ fears of a supercharged Internal Revenue Service (IRS) with an executive order halting the hiring of federal employees until his Administration determines that it is in the national interest to do so. This includes curtailing the onboarding of tens of thousands new IRS agents called for by Democrats in the so-called Inflation Reduction Act. In supporting the President Trump order, Ways and Means Chairman Jason Smith (MO-08) issued the following statement:
“President Trump’s cease-and-desist order to the IRS is a crucial first step to helping middle-class Americans and small businesses living in fear of 87,000 new IRS agents targeting them with new audits and monitoring their personal transactions. Democrats have said all along that they will ramp up audits on Americans every year to squeeze as much revenue out of them as possible. A return to ‘historical audit levels’ as sought by Democrats means 600,000 more families making less than $75,000 would be hit with an IRS audit.
“Even the Treasury Inspector General for Tax Administration revealed that the agency had put zero safeguards in place for low- and middle-income taxpayers to protect them from audits, despite having had two years to do so. So the American people elected President Trump to be that safeguard, and he is stopping this scheme dead in its tracks.
“And it’s a good thing, too: More invasive audits from the tax collector would be ripe for abuse given that the agency has been out of control. Not only has the agency been providing political cover for Democrats by delaying and now phasing in an unpopular 1099-K reporting scheme where 90% of the burden falls on taxpayers making less than $200,000 and targets gig workers and small businesses, but activists at the IRS leaked sensitive data about political opponents — including President Trump himself. The Biden Justice Department sought only a slap on the wrist as punishment, which would hardly deter future criminal behavior.
“Congress fought to rescind new funding intended for new auditors at the IRS as part of the Fiscal Responsibility Act. The American people overwhelmingly supported this move and gave President Trump a mandate to end the weaponization of the federal government and to cut the bureaucracy. Now he’s taking action.”
Background:
This week, President Trump signed an executive order freezing hiring in the federal government, specifically calling out the IRS. The order reads:
Within 90 days of the date of this memorandum, the Director of the Office of Management and Budget (OMB), in consultation with the Director of OPM and the Administrator of the United States DOGE Service (USDS), shall submit a plan to reduce the size of the Federal Government’s workforce through efficiency improvements and attrition. Upon issuance of the OMB plan, this memorandum shall expire for all executive departments and agencies, with the exception of the Internal Revenue Service (IRS). This memorandum shall remain in effect for the IRS until the Secretary of the Treasury, in consultation with the Director of OMB and the Administrator of USDS, determines that it is in the national interest to lift the freeze.
October 2024: After the IRS already unlawfully delayed Democrats’ own 1099-K reporting scheme for two years – providing political cover for the Administration – they went a step further. The original scheme was scheduled to be implemented in 2023 and would bury gig workers under a mountain of paperwork, with over 90 percent of the tax burden falling on Americans earning less than $200,000. The IRS eventually announced a new $5,000 threshold, creating a new scaled phase-in so the 1099-K policy would fully detonate in the middle of President Trump’s second term in office.
September 2024: House Republicans passed Chairman Smith’s Taxpayer Data Privacy Act, but Senate Democrats refused to advance it.
Read: House Passes Bill To Protect Taxpayer Privacy and Confidential Information
January 2024: Chairman Smith led a letter from Ways and Means Republicans urging the judge overseeing the case involving the leak of sensitive taxpayer information to sentence the IRS leaker to the maximum sentence, despite the Biden Justice Department seeking a lesser sentence.
Read: Ways & Means Republicans: “Throw the Book” at IRS Leaker
June 2023: House Republicans rescinded Democrats’ new funding for IRS auditors as part of a bipartisan agreement to lift the debt ceiling. Democrats had previously allocated 14 times as much money for enforcement as they did for customer service, which would have run out in just four years – while spending on new audits would skyrocket over the next ten years.