Why Would Politicians Object To New IRS Rules About Donation Disclosure?


The Internal Revenue Service has just announced new rules about who has to disclose donations to non-profit groups. The basic point appearing to be that certain non-profits do not attract tax relief at the level of the donor when a donation is made. Thus there’s no reason for anyone to report to the IRS – there’s no tax issue at stake. Seems logical enough to me but certain politicians are complaining about this. It does make one wonder why:

Certain tax-exempt groups will no longer be required to provide the names and addresses of donors to the IRS on annual forms under guidance that the Treasury Department and IRS released Monday evening.

The guidance reflects a priority of conservatives, who have been pushing for the IRS to bar collection of the donor information as part of their efforts to prevent the agency from targeting groups for their political beliefs.

Well, that’s actually a good reason. For we did indeed have a certain amount of political direction of who was being investigated as to their donations, didn’t we? But do note that the donors aren’t gaining a tax break to this specific type of organisation. So, well, this seems to be fair enough:

But the move frees labor unions, issue advocacy organizations, veterans groups and other nonprofits that do not receive tax-exempt money from meeting confidential disclosure requirements set in place decades ago.

“Americans shouldn’t be required to send the IRS information that it doesn’t need to effectively enforce our tax laws, and the IRS simply does not need tax returns with donor names and addresses to do its job in this area,” U.S. Treasury Secretary Steven Mnuchin said in a statement.

Again, this all seems entirely fair. Sure, the IRS might need certain information to enforce the tax laws. But if it’s not needed for that purpose then why should the IRS have that information? It being rather the foundation of the American ideal that government should only be doing those things which must be done by government, no?

But there are politicians who are complaining about this all the same:

The decision immediately sparked a backlash, with Sen. Ron Wyden (D-Ore.) saying Tuesday that he’ll oppose the nomination of a new IRS commissioner over the move.

“It’s the latest attempt by Secretary Mnuchin and Donald Trump to eliminate transparency and keep officials and lawmakers from following the money,” Wyden said in a statement. “That’s why I’ll be opposing Charles Rettig, nominee to be IRS commissioner, unless Mr. Rettig commits to restoring this critical disclosure requirement.”

Well, yes. At which point perhaps we should allow the cynic in all of us to rear his ugly head. Or the realist, if you prefer. It’s well known that donors donate – in general that is – across the political landscape. A gentle, if not genteel, placing of light bets so as to ensure that whoever wins access is always maintained. It’s that which our cynic – us as cynic or realist perhaps – might explain the Good Solon’s insistence upon transparency and openness here. After all, if everyone has to publish lists of who has donated to each and every issue then that’s a great prospecting list for your own campaign fund travails, isn’t it? Just imagine if you had to telephone around blind trying to scare up the tens of millions required for re-election?

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