GOP Panel Advances $2 Billion IRS Enforcement Funding Cut

House Republican appropriators overcame Democratic objections to advance a funding bill that includes a roughly 18% cut to the IRS from this year’s funding levels.

The subcommittee by voice vote moved the financial services and general government bill, which funds agencies—including the IRS, Treasury, and Tax Court—toward full Appropriations Committee consideration. The bill gives the IRS $10.12 billion for fiscal year 2025, slashing the agency’s budget by $2.2 billion compared to fiscal 2024 levels and this year’s White House request to hold the funding flat.

Treasury officials and the top Democrat on the subcommittee, Rep. Steny Hoyer (D-Md.), accused Republicans of breaking their promise to reduce deficits with cuts to IRS funding that could help the agency go after wealthy tax dodgers.

“This bill is going nowhere,” Hoyer said.

The Democrat-controlled Senate didn’t favor similar cuts in their bill last year, and they were ultimately stripped in the final package.

Subcommittee Chair David Joyce (R-Ohio) pushed back, pointing to the 2022 tax-and-climate law dubbed the Inflation Reduction Act’s billions for the agency.

“I like to remind my colleagues that the IRS has over $40 billion in available resources from the Inflation Reduction Act,” Joyce said. That law set aside billions for the agency to modernize, including about $44 billion for enforcement.

Though the bill cuts enforcement, it provides $150 million for business systems modernization, a fund that had been zeroed out in recent spending laws. The bill revives language included in last year’s House GOP-led appropriations bill, which calls for barring the IRS from moving toward making its free electronic filing program permanent without congressional approval.

Though any final bill must be negotiated with the White House and Senate, the House spending bills set a marker for the chamber’s tax-related priorities. Those goals include zeroing out US funding for the OECD, the group negotiating the global tax deal, in a separate bill that also advanced this week.